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(International) R&D Collaboration and SMEs: The effectiveness of targeted public R&D support schemes

  • LOPES BENTO Cindy
  • HOTTENROTT Hanna

This study analyses the effectiveness of targeted public support for R&D investment. In particular, we test whether the specific policy design aiming at incentivizing (international)collaboration and R&D in small and medium-sized firms achieves the desired objectives on input as well as output additionality. Our results show that the targeted R&D subsidies accelerate R&D spending in the private sector, and especially so in the targeted groups. Further, we differentiate between privately financed R&D and subsidy-induced R&D investment to evaluate their respective effects on innovation performance. The results confirm that the induced R&D is productive as it translates into marketable product innovations. While both types of R&D investments trigger significant output effects, we find that the effect of subsidy-induced R&D investment is higher for firms that collaborate internationally as well as for SMEs.

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Paper provided by CEPS/INSTEAD in its series CEPS/INSTEAD Working Paper Series with number 2012-36.

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Length: 44 pages
Date of creation: Oct 2012
Date of revision:
Handle: RePEc:irs:cepswp:2012-36
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