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R&D and subsidies at the firm level: an application of parametric and semiparametric two-step selection models

  • Katrin Hussinger

    (University of Maastricht, Netherlands, Centre for European Economic Research (ZEW), and Catholic University Leuven, Belgium)

This paper analyzes the effect of public R&D subsidies on firms' private R&D investment per employee and new product sales in German manufacturing. Parametric and semiparametric two-step selection models are applied to this evaluation problem. The results show that the average treatment effect on the treated firms' R&D intensity is positive. The estimated effects are robust with respect to the different selection models. Further results show that publicly induced R&D spending is as productive as private R&D investment in generating new product sales. Copyright © 2008 John Wiley & Sons, Ltd.

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File URL: http://hdl.handle.net/10.1002/jae.1016
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File URL: http://qed.econ.queensu.ca:80/jae/2008-v23.6/
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Article provided by John Wiley & Sons, Ltd. in its journal Journal of Applied Econometrics.

Volume (Year): 23 (2008)
Issue (Month): 6 ()
Pages: 729-747

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Handle: RePEc:jae:japmet:v:23:y:2008:i:6:p:729-747
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