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Do the effects of R&D tax credits vary across industries? A meta-regression analysis

Author

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  • Castellacci, Fulvio
  • Lie, Christine Mee

Abstract

This paper presents a survey of the micro-econometric literature on the effects of R&D tax credits on firms’ innovation activities. We focus on one specific aspect that has not received sufficient attention in previous research: the sectoral dimension. Our meta-regression analysis (MRA) sets up a new database collecting a large number of firm-level studies on the effects of R&D tax credits and investigates the factors that may explain differences in the estimated effects that are reported in the literature. The main result of the MRA analysis is indeed that sectors matter. Specifically, the additionality effect of R&D tax credits is on average stronger for SMEs, firms in the service sectors, and firms in low-tech sectors in countries with an incremental scheme. The paper proposes a simple framework to investigate why the innovation and economic effects of R&D tax credits vary across sectors and points out new directions and hypotheses for future research.

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  • Castellacci, Fulvio & Lie, Christine Mee, 2015. "Do the effects of R&D tax credits vary across industries? A meta-regression analysis," Research Policy, Elsevier, vol. 44(4), pages 819-832.
    • Handle: RePEc:eee:respol:v:44:y:2015:i:4:p:819-832
    DOI: 10.1016/j.respol.2015.01.010
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    More about this item

    Keywords

    R&D tax credits; R&D policy; Sectors; Meta-regression analysis;
    All these keywords.

    JEL classification:

    • H25 - Public Economics - - Taxation, Subsidies, and Revenue - - - Business Taxes and Subsidies
    • H32 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - Firm
    • O32 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Management of Technological Innovation and R&D
    • O38 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Government Policy

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