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A policy to boost R&D: Does the R&D tax credit work?

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Author Info

  • Ientile, Damien

    ()
    (Paris School of Economics)

  • Mairesse, Jacques

    ()
    (CREST (Paris) & University of Maastricht)

Abstract

In this article we address various issues raised by the evaluation of the R&D tax credit policy. We first consider the studies that estimate the direct effects of the tax credit on R&D inputs. We discuss results obtained through different approaches and methods and show that they give a contrasted picture of the policy’s effectiveness. Next we argue that a comprehensive evaluation of the R&D tax credit should include other outcomes and present studies focussing on them. We also initiate a very tentative meta-analysis to obtain a more synthetic view on the various evaluation results. We finally conclude that harmonization and increased comparability in evaluation studies would be useful to bridge the gab between evaluation and policy design and implementation.

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Bibliographic Info

Paper provided by European Investment Bank, Economics Department in its series EIB Papers with number 6/2009.

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Length: 25 pages
Date of creation: 23 Dec 2009
Date of revision:
Handle: RePEc:ris:eibpap:2009_006

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Related research

Keywords: R&D; R&D tax credit; R&D capital; capital use cost; evaluation; meta-analysis;

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References

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Cited by:
  1. Klette, Tor Jakob & Møen, Jarle, 2011. "R&D investment responses to R&D subsidies: A theoretical analysis and a microeconometric study," Discussion Papers 2011/15, Department of Business and Management Science, Norwegian School of Economics.
  2. Benjamin Montmartin & Marcos Herrera, 2014. "Internal and External Effects of R&D Subsidies and Fiscal Incentives: Empirical Evidence Using Spatial Dynamic Panel Models," GREDEG Working Papers 2014-09, Groupe de REcherche en Droit, Économie, Gestion (GREDEG CNRS), University of Nice Sophia Antipolis.

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