Private returns to R&D in the presence of spillovers, revisited

This is both a replication of Eberhardt et al. (Review of Economics and Statistics, 2013, 95(2), 436-448) using different software, and a critical extension and diagnostic reassessment of the original results. The main findings of the paper are confirmed and sometimes reinforced. We point out some inconsistencies, in particular in the calculation of standard errors for the common correlated effects pooled model; we extend the diagnostic checks; lastly, in the spirit of the original contribution, we show how local cross-sectional dependence diagnostics can be used to provide a first assessment of the direction of spillovers. We provide complete replication code in open source R.