Evaluating the Impacts of Subsidies on Innovation Activities in Germany


Hujer, Reinhard ; Radic, Dubravko


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URL: http://ub-madoc.bib.uni-mannheim.de/1117
URN: urn:nbn:de:bsz:180-madoc-11172
Document Type: Working paper
Year of publication: 2005
Publication language: English
Institution: Sonstige Einrichtungen > ZEW - Leibniz-Zentrum für Europäische Wirtschaftsforschung
MADOC publication series: Veröffentlichungen des ZEW (Leibniz-Zentrum für Europäische Wirtschaftsforschung) > ZEW Discussion Papers
Subject: 330 Economics
Subject headings (SWD): Deutschland , Innovation , Forschung und Entwicklung , Evaluation , Mikroökonomie
Abstract: Innovations are a key factor to ensure the competitiveness of establishments as well as to enhance the growth and wealth of nations. But more than any other economic activity, decisions about innovations are plagued by failures of the market mechanism. As a response, public instruments have been implemented to stimulate private innovation activities. The effectiveness of these measures, however, is ambiguous and calls for an empirical evaluation. In this paper we make use of the IAB Establishment Panel and apply various microeconometric methods to estimate the effect of public measures on innovation activities of German establishments. We find that neglecting sample selection due to observable as well as to unobservable characteristics leads to an overestimation of the treatment effect and that there are considerable differences with regard to size class and betweenWest and East German establishments.
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Hujer, Reinhard ; Radic, Dubravko (2005) Evaluating the Impacts of Subsidies on Innovation Activities in Germany. Open Access [Working paper]
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