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The impact of R&D policies: A review of recent studies

Author

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  • Paolo Fornaro

    (Labour Institute for Economic Research LABORE)

Abstract

In this paper, I review the empirical literature of the last 20 or so years on the impact of public support to R&D, focusing on direct R&D subsidies and on R&D tax credits. The review considers both the impacts on R&D inputs, meaning private R&D expenditures, and outputs, such as patenting activity and productivity growth. In the survey, I include both macro-level studies, which examine the effects of public R&D support at the aggregate level, and micro-level analyses, which evaluate the impacts on firm- and worker-level outcomes. The studies covered in the review indicate a strong effectiveness of public R&D policies in stimulating private R&D activity. The effects on innovation and productivity are more uncertain, and might take long to materialize, but most of the works considered gave a positive assessment of public support to R&D.

Suggested Citation

  • Paolo Fornaro, 2026. "The impact of R&D policies: A review of recent studies," Working Papers 364, Työn ja talouden tutkimus LABORE, The Labour Institute for Economic Research LABORE.
    • Handle: RePEc:pst:wpaper:364
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    Keywords

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    JEL classification:

    • O30 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - General
    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
    • 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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