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

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  • 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?’

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  • 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
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    Cited by:

    1. 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.
    2. 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.
    3. Harris, Richard, 2009. "Spillover and backward linkage effects of FDI: empirical evidence for the UK," LSE Research Online Documents on Economics 33206, London School of Economics and Political Science, LSE Library.
    4. Zhao, Lingxiao & Liu, Xiao & Tang, Yunpeng & Zhang, Wenjing, 2024. "Functional subsidies, selective subsidies and corporate investment efficiency: Evidence from China," Emerging Markets Review, Elsevier, vol. 61(C).
    5. 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.
    6. Zhang, Xiekui & Gong, Dayong & Huang, Yihan & Li, Yiting, 2024. "The Government's fiscal and taxation policy effect on enterprise productivity: Policy choice and optimal allocation," International Review of Economics & Finance, Elsevier, vol. 93(PB), pages 28-41.
    7. Ankarhem, Mattias & Daunfeldt, Sven-Olov & Quoreshi, Shahiduzzaman & Rudholm, Niklas, 2009. "Do Regional Investment Grants Improve Firm Performance? - Evidence from Sweden," HUI Working Papers 24, HUI Research.
    8. 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.
    9. 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.
    10. 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.
    11. Santos, Eleonora, 2017. "Externalities from FDI on domestic firms’ Productivity: A Literature Review for Developed Countries," MPRA Paper 88958, University Library of Munich, Germany.
    12. Nicholas Crafts & Alan Hughes, 2013. "Industrial Policy for the Medium to Long-term," Working Papers wp455, Centre for Business Research, University of Cambridge.
    13. Crafts, Nicholas, 2012. "Creating Competitive Advantage: Policy Lessons from History," CAGE Online Working Paper Series 91, Competitive Advantage in the Global Economy (CAGE).
    14. 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.
    15. 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.
    16. 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.
    17. 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.
    18. 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.
    19. David Blackaby & Stephen Drinkwater & Catherine Robinson, 2020. "Regional Variations in the Brexit Vote: Causes and Potential Consequences," RFBerlin Discussion Paper Series 2018, Rockwool Foundation Berlin (RF Berlin).
    20. 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.
    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.
    23. 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.
    24. 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.

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