Semi-endogenous models and, to some extent, also Schumpeterian models are based on the assumption of diminishing returns to R&D. This paper shows that the null hypothesis of constant returns to R&D cannot be rejected for the OECD countries.
Link
http://econpapers.repec.org/scripts/redir.pl?u=http%3A%2F%2Fwww.econ.ku.dk%2Fepru%2Ffiles%2Fwp%2Fwp-06-05.pdf;h=repec:kud:epruwp:06-05