“…This argument has been confirmed by recent works using more sophisticated, trade-related weights (Lumenga-Neso et al, 2005), different measures of knowledge capital (Bottazzi and Peri, 2007;Madsen, 2007, and, or alternative mechanism of knowledge propagation (Lee, 2006 andMendi, 2007). It should be however emphasized that the differential impact between foreign and domestic R&D might be reducing over time (Guellec and van Pottelsberghe, 2004) and such other factors as human capital and institutional characteristics may be influential for productivity growth (see Engelbrecht, 1997, Frantzen, 2000and Coe et al, 2008.…”