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The Impact Of Public R&D Expenditure On Business R&D Author info | Abstract | Publisher info | Download info | Related research | Statistics DOMINIQUE GUELLEC
BRUNO VAN POTTELSBERGHE DE LA POTTERIE
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This paper attempts to quantify the aggregate net effect of government funding on business R&D in 17 OECD Member countries over the past two decades. Grants, procurement, tax incentives and direct performance of research (in public laboratories or universities) are the major policy tools in the field. The major results of the study are the following: Direct government funding of R&D performed by firms has a positive effect on business financed R&D (except if the funding is targeted towards defence activities). Tax incentives have an immediate and positive effect on business-financed R&D; Direct funding as well as tax incentives are more effective when they are stable over time: firms do not invest in additional R&D if they are uncertain of the durability of the government support; Direct government funding and R&D tax incentives are substitutes: increased intensity of one reduces the effect of the other on business R&D; The stimulating effect of government funding varies with respect to its generosity: it increases up to a certain threshold (about 10% of business R&D) and then decreases beyond; Defence research performed in public laboratories and universities crowds out private R&D; Civilian public research is neutral for business R&D.
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Article provided by Taylor and Francis Journals in its journal Economics of Innovation and New Technology .
Volume (Year): 12 (2003)
Issue (Month): 3 (January)
Pages: 225-243
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Handle: RePEc:taf:ecinnt:v:12:y:2003:i:3:p:225-243Contact details of provider: Web page: http://taylorandfrancis.metapress.com/link.asp?target=journal&id=300230
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For technical questions regarding this item, or to correct its listing, contact: (Christopher F. Baum).
Keywords: Technology Policy ; Tax Credit ; R&D ; Panel Data ; Other versions of this item:
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