R&D , complementarity , research subsidies , development subsidies , innovation policy
Abstract:
This study investigates the effects of an R&D subsidy scheme on participating firms’ net R&D
investment. Making use of a specific policy design in Belgium that explicitly distinguishes
between research and development grants, we estimate direct and cross-scheme effects on research
versus development intensities in recipients firms. We find positive direct effects from research
(development) subsidies on net research (development) spending. This direct effect is larger for
research grants than for development grants. We also find cross-scheme effects that may arise due
to complementarity between research and development activities. Finally, we find that the
magnitude of the treatment effects depends on firm size and age and that there is a minimum
effective grant size, especially for research projects. The results support the view that public
subsidies induce higher additional investment particularly in research where market failures are
larger, even when the subsidies are targeting development.
Das Dokument wird vom Publikationsserver der Universitätsbibliothek Mannheim bereitgestellt.
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