The Long-Run Growth Effects of R&D Subsidies
This article presents a generalized version of Howitt's (1999) model of R&D-driven growth without scale effects and a complete characterization of the long-run growth effects of R&D subsidies. R&D subsidies can either promote or retard long-run economic growth, and surprisingly, the growth-retarding outcome occurs for a wide range of plausible parameter values. This article also presents a new intuitive explanation for why R&D subsidies can have long-run growth effects (both positive and negative). Copyright 2000 by Kluwer Academic Publishers
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