This study examines the effectiveness of R&D tax incentives using an unbalanced panel of 434 Canadian firms. Not all firms in the sample are R&D performers. A B-index summarizing the various tax incentives for R&D is constructed for each firm, taking into account individual ceilings in the use of the relevant tax incentives. A generalized Tobit model with fixed effects is estimated. A one percent increase in the federal tax credit to R&D yields an average of $0.98 additional R&D expenditure per dollar of tax revenues foregone (for firms with a ceiling in their use of federal tax credit). Using the same measure on firms which are not subject to a ceiling, we obtain $1.04. Tax transfers represent more than 80% of the cost of government support to R&D.
Cet articleétudie l'effet des incitatifs fiscaux à la R&D à partir d'unéchantillon non cylindré de 434 firmes canadiennes (dont certaines ne font pas de R&D). Avec les données de Compustat, nous estimons un modèle Tobit généralisé (à effet fixe). Ce modèle détermine notamment l'effet du prix effectif de la R&D (indice-B tenant compte des différents plafonds dans l'utilisation des incitatifs fiscaux) sur le stock de la recherche. En augmentant d'un pourcent le crédit d'impôt fédéral à la R&D, nous obtenons en moyenne 0,98$ de dépenses additionnelles de R&D par dollar de dépense fiscale (firme ayant un plafond d'utilisation du crédit fédéral). Ce résultat est majoré à 1,04$ pour les firmes pouvant utiliser la totalité du crédit fédéral. Le transfert fiscal représente plus de 80 % du coût du soutien à la R&D par le gouvernement.
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Find related papers by JEL classification: H32 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - Firm O31 - Economic Development, Technological Change, and Growth - - Technological Change - - - Innovation and Invention: Processes and Incentives O38 - Economic Development, Technological Change, and Growth - - Technological Change - - - Government Policy
References listed on IDEAS Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
Rachel Griffith & David Sandler & John Van Reenen, 1995.
"Tax incentives for R&D,"
Fiscal Studies,
Institute for Fiscal Studies, vol. 16(2), pages 21-44, May.
[Downloadable!]
John Bound & Clint Cummins & Zvi Griliches & Bronwyn H. Hall & Adam B. Jaffe, 1982.
"Who Does R&D and Who Patents?,"
NBER Working Papers
0908, National Bureau of Economic Research, Inc.
[Downloadable!] (restricted)
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John Bound & Clint Cummins & Zvi Griliches & Bronwyn H. Hall & Adam B. Jaffe, 1984.
"Who Does R&D and Who Patents?,"
NBER Chapters,
in: R & D, Patents, and Productivity, pages 21-54
National Bureau of Economic Research, Inc.
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