IDEAS home Printed from https://ideas.repec.org/a/bla/scotjp/v51y2004i4p528-543.html
   My bibliography  Save this article

Industrial Policy In Great Britain And Its Effect On Total Factor Productivity In Manufacturing Plants, 1990–1998

Author

Listed:
  • Richard Harris
  • Catherine Robinson

Abstract

Industrial policy in any economy has a number of varying and occasionally conflicting objectives, but the overarching intention of the various grants, subsidies and support schemes, arguably, must be to improve the economic performance of the plants they assist directly. However, in the absence of counterfactual evidence, whether or not assistance does improve performance is hard to establish. In this paper, we consider the impact of two UK government industrial support schemes (Regional Selective Assistance and the Small Firm Merit Awards for Research and Technology) on UK manufacturing plant level total factor productivity in an attempt to answer the question, ‘did assistance make a difference?’

Suggested Citation

  • Richard Harris & Catherine Robinson, 2004. "Industrial Policy In Great Britain And Its Effect On Total Factor Productivity In Manufacturing Plants, 1990–1998," Scottish Journal of Political Economy, Scottish Economic Society, vol. 51(4), pages 528-543, September.
    • Handle: RePEc:bla:scotjp:v:51:y:2004:i:4:p:528-543
    DOI: 10.1111/j.0036-9292.2004.00319.x
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/j.0036-9292.2004.00319.x
    Download Restriction: no
    File URL: https://libkey.io/10.1111/j.0036-9292.2004.00319.x?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Patrick Puhani, 2000. "The Heckman Correction for Sample Selection and Its Critique," Journal of Economic Surveys, Wiley Blackwell, vol. 14(1), pages 53-68, February.
    2. Klette, Tor Jakob & Moen, Jarle & Griliches, Zvi, 2000. "Do subsidies to commercial R&D reduce market failures? Microeconometric evaluation studies1," Research Policy, Elsevier, vol. 29(4-5), pages 471-495, April.
    3. Faulk, Dagney, 2002. "Do State Economic Development Incentives Create Jobs? An Analysis of State Employment Tax Credits," National Tax Journal, National Tax Association, vol. 55(N. 2), pages 263-280, June.
    4. Harvey Armstrong, 2001. "Regional Selective Assistance: Is the Spend Enough and Is It Targeting the Right Places?," Regional Studies, Taylor & Francis Journals, vol. 35(3), pages 247-257.
    5. R. I. D. Harris & Stephen Drinkwater, 2000. "UK Plant and Machinery Capital Stocks and Plant Closures," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 62(2), pages 243-265, May.
    6. Rachel Griffith, 1999. "Using the ARD establishment level data to look at foreign ownership and productivity in the UK," IFS Working Papers W99/06, Institute for Fiscal Studies.
    7. Richard Harris, 2001. "Comparing Regional Technical Efficiency in UK Manufacturing Plants: The Case of Northern Ireland 1974-1995," Regional Studies, Taylor & Francis Journals, vol. 35(6), pages 519-534.
    8. Faulk, Dagney, 2002. "Do State Economic Development Incentives Create Jobs? An Analysis of State Employment Tax Credits," National Tax Journal, National Tax Association;National Tax Journal, vol. 55(2), pages 263-280, June.
    9. Colin Wren, 2001. "The industrial policy of competitiveness: A review of recent developments in the UK," Regional Studies, Taylor & Francis Journals, vol. 35(9), pages 847-860.
    10. Richard Harris, 2002. "Foreign Ownership and Productivity in the United Kingdom—Some Issues When Using the ARD Establishment Level Data," Scottish Journal of Political Economy, Scottish Economic Society, vol. 49(3), pages 318-335, August.
    11. Heckman, James J, 1990. "Varieties of Selection Bias," American Economic Review, American Economic Association, vol. 80(2), pages 313-318, May.
    12. Jim Taylor & Colin Wren, 1997. "UK Regional Policy: An Evaluation," Regional Studies, Taylor & Francis Journals, vol. 31(9), pages 835-848.
    13. Griffith, Rachel, 1999. "Using the ARD Establishment Level Data to Look at Foreign Ownership and Productivity in the United Kingdom," Economic Journal, Royal Economic Society, vol. 109(456), pages 416-442, June.
    14. Todd M. Gabe & David S. Kraybill, 2002. "The Effect of State Economic Development Incentives on Employment Growth of Establishments," Journal of Regional Science, Wiley Blackwell, vol. 42(4), pages 703-730.
    15. Richard Blundell & Stephen Bond, 2000. "GMM Estimation with persistent panel data: an application to production functions," Econometric Reviews, Taylor & Francis Journals, vol. 19(3), pages 321-340.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Richard Harris & John Moffat, 2020. "The impact of product subsidies on plant‐level total factor productivity in Britain, 1997–2014," Scottish Journal of Political Economy, Scottish Economic Society, vol. 67(4), pages 387-403, September.
    2. Richard Harris & John Moffat, 2011. "Plant-level Determinants of Total Factor Productivity in Great Britain, 1997-2006," SERC Discussion Papers 0064, Centre for Economic Performance, LSE.
    3. Richard Harris, 2009. "Spillover and Backward Linkage Effects of FDI: Empirical Evidence for the UK," SERC Discussion Papers 0016, Centre for Economic Performance, LSE.
    4. Chia-Hui Huang, 2015. "Tax credits and total factor productivity: firm-level evidence from Taiwan," The Journal of Technology Transfer, Springer, vol. 40(6), pages 932-947, December.
    5. Santos, Eleonora, 2017. "Externalities from FDI on domestic firms’ Productivity: A Literature Review for Developed Countries," MPRA Paper 88958, University Library of Munich, Germany.
    6. Crafts, Nicholas, 2012. "Creating Competitive Advantage: Policy Lessons from History," CAGE Online Working Paper Series 91, Competitive Advantage in the Global Economy (CAGE).
    7. Andries Brandsma & d'Artis Kancs & Pavel Ciaian, 2013. "The Role of Additionality in the EU Cohesion Policies: An Example of Firm-Level Investment Support," European Planning Studies, Taylor & Francis Journals, vol. 21(6), pages 838-853, June.
    8. Ankarhem, Mattias & Daunfeldt, Sven-Olov & Quoreshi, Shahiduzzaman & Rudholm, Niklas, 2009. "Do Regional Investment Grants Improve Firm Performance? Evidence from Sweden," Ratio Working Papers 137, The Ratio Institute.
    9. David Blackaby & Stephen Drinkwater & Catherine Robinson, 2020. "Regional Variations in the Brexit Vote: Causes and Potential Consequences," RF Berlin - CReAM Discussion Paper Series 2018, Rockwool Foundation Berlin (RF Berlin) - Centre for Research and Analysis of Migration (CReAM).
    10. Kolesnikova Irina, 2010. "State Aid for Industrial Enterprises in Belarus: Remedy or Poison?," EERC Working Paper Series 10/01e, EERC Research Network, Russia and CIS.
    11. Ondřej Dvouletý & Stjepan Srhoj & Smaranda Pantea, 2021. "Public SME grants and firm performance in European Union: A systematic review of empirical evidence," Small Business Economics, Springer, vol. 57(1), pages 243-263, June.
    12. Bernini, Cristina & Cerqua, Augusto & Pellegrini, Guido, 2017. "Public subsidies, TFP and efficiency: A tale of complex relationships," Research Policy, Elsevier, vol. 46(4), pages 751-767.
    13. Girma, Sourafel & Gorg, Holger & Strobl, Eric, 2007. "The effect of government grants on plant level productivity," Economics Letters, Elsevier, vol. 94(3), pages 439-444, March.
    14. Girma, Sourafel & Gorg, Holger & Strobl, Eric, 2007. "The effects of government grants on plant survival: A micro-econometric analysis," International Journal of Industrial Organization, Elsevier, vol. 25(4), pages 701-720, August.
    15. Ondřej Dvouletý & Ivana Blažková, 2019. "The Impact of Public Grants on Firm-Level Productivity: Findings from the Czech Food Industry," Sustainability, MDPI, vol. 11(2), pages 1-24, January.
    16. Sourafel Girma & Holger Görg & Aoife Hanley & Eric Strobl, 2010. "The effect of grant receipt on start-up size: Evidence from plant level data," Journal of International Entrepreneurship, Springer, vol. 8(4), pages 371-391, December.
    17. Nicholas Crafts & Alan Hughes, 2013. "Industrial Policy for the Medium to Long-term," Working Papers wp455, Centre for Business Research, University of Cambridge.
    18. John Moffat, 2014. "Regional Selective Assistance in Scotland: Does it make a difference to plant productivity?," Urban Studies, Urban Studies Journal Limited, vol. 51(12), pages 2555-2571, September.
    19. Li, Mingyang & Jin, Man & Kumbhakar, Subal C., 2022. "Do subsidies increase firm productivity? Evidence from Chinese manufacturing enterprises," European Journal of Operational Research, Elsevier, vol. 303(1), pages 388-400.
    20. Giuseppina Testa & Katarzyna Szkuta, 2018. "Improving access to finance for young innovative enterprises with growth potential: evidence of impact on firms' output - Part 2. R&D grant schemes: lessons learned from evaluations," JRC Research Reports JRC109879, Joint Research Centre.
    21. Jindrich SPICKA & Zdenka NAGLOVA & Martin GURTLER, 2017. "Effects of the investment support in the Czech meat processing industry," Agricultural Economics, Czech Academy of Agricultural Sciences, vol. 63(8), pages 356-369.
    22. Marco Di Cataldo, 2016. "Gaining and losing EU Objective 1 funds: Regional development in Britain and the prospect of Brexit," LEQS – LSE 'Europe in Question' Discussion Paper Series 120, European Institute, LSE.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Richard Harris & Catherine Robinson, 2003. "Foreign Ownership and Productivity in the United Kingdom Estimates for U.K. Manufacturing Using the ARD," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 22(3), pages 207-223, May.
    2. Harris, Richard & Moffat, John, 2011. "Plant-level determinants of total factor productivity in Great Britain, 1997-2006," LSE Research Online Documents on Economics 33561, London School of Economics and Political Science, LSE Library.
    3. Richard Harris & John Moffat, 2015. "Plant-level determinants of total factor productivity in Great Britain, 1997–2008," Journal of Productivity Analysis, Springer, vol. 44(1), pages 1-20, August.
    4. R Harris & Q Li, "undated". "Exporting, R&D and Absorptive Capacity in UK Establishments: Evidence from the 2001 Community Innovation Survey," Working Papers 2006_19, Business School - Economics, University of Glasgow.
    5. Arnold, Jens Matthias & Javorcik, Beata Smarzynska, 2005. "Gifted kids or pushy parents? Foreign acquisitions and plant performance in Indonesia," Policy Research Working Paper Series 3597, The World Bank.
    6. Benfratello, Luigi & Sembenelli, Alessandro, 2006. "Foreign ownership and productivity: Is the direction of causality so obvious?," International Journal of Industrial Organization, Elsevier, vol. 24(4), pages 733-751, July.
    7. Richard Harris & John Moffat, 2020. "The impact of product subsidies on plant‐level total factor productivity in Britain, 1997–2014," Scottish Journal of Political Economy, Scottish Economic Society, vol. 67(4), pages 387-403, September.
    8. Harris, Richard & Li, Qian Cher & Trainor, Mary, 2009. "Is a higher rate of R&D tax credit a panacea for low levels of R&D in disadvantaged regions?," Research Policy, Elsevier, vol. 38(1), pages 192-205, February.
    9. Nigel Driffield & Sourafel Girma, 2003. "Regional Foreign Direct Investment and Wage Spillovers: Plant Level Evidence from the UK Electronics Industry," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 65(4), pages 453-474, September.
    10. Gurmu, Shiferaw & Sjoquist, David L. & Wheeler, Laura, 2021. "The effectiveness of job creation tax credits," Regional Science and Urban Economics, Elsevier, vol. 90(C).
    11. Jones, Jonathan & Wren, Colin, 2008. "Re-investment and the survival of foreign-owned plants," LSE Research Online Documents on Economics 33138, London School of Economics and Political Science, LSE Library.
    12. Thangavelu, Shandre M. & Chongvilaivan, Aekapol, 2013. "Financial Health and Firm Productivity: Firm-level Evidence from Viet Nam," ADBI Working Papers 434, Asian Development Bank Institute.
    13. Harris, R. I. D. & Hassaszadeh, P., 2002. "The impact of ownership changes and age effects on plant exits in UK manufacturing, 1974-1995," Economics Letters, Elsevier, vol. 75(3), pages 309-317, May.
    14. T. William Lester & Nichola J. Lowe & Allan Freyer, 2014. "Mediating Incentive Use," Economic Development Quarterly, , vol. 28(2), pages 132-146, May.
    15. Donald S. Siegel & Kenneth L. Simons & Tomas Lindstrom, 2009. "Ownership Change, Productivity, and Human Capital: New Evidence from Matched Employer-Employee Data," NBER Chapters, in: Producer Dynamics: New Evidence from Micro Data, pages 397-442, National Bureau of Economic Research, Inc.
    16. Yoonseok Lee & Mary E. Lovely & Hoang Pham, 2023. "Dynamic and non‐neutral productivity effects of foreign ownership: A nonparametric approach," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 38(1), pages 24-48, January.
    17. John Moffat, 2014. "Regional Selective Assistance in Scotland: Does it make a difference to plant productivity?," Urban Studies, Urban Studies Journal Limited, vol. 51(12), pages 2555-2571, September.
    18. Neil Foster-McGregor & Anders Isaksson & Florian Kaulich, 2014. "Importing, exporting and performance in sub-Saharan African manufacturing firms," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 150(2), pages 309-336, May.
    19. Jacob Bundrick & Weici Yuan, 2019. "Do Targeted Business Subsidies Improve Income and Reduce Poverty? A Synthetic Control Approach," Economic Development Quarterly, , vol. 33(4), pages 351-375, November.
    20. Christian Bellak, 2004. "How Domestic and Foreign Firms Differ and Why Does it Matter?," Journal of Economic Surveys, Wiley Blackwell, vol. 18(4), pages 483-514, September.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:scotjp:v:51:y:2004:i:4:p:528-543. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: https://edirc.repec.org/data/sesssea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.