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R&D and Subsidies at the Firm Level: An Application of Parametric and Semi-Parametric Two-Step Selection Models

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  • Hussinger, Katrin

Abstract

This paper analyzes the effects of public R&D subsidies on R&D expenditure in the German manufacturing sector. The focus is on the question whether public R&D funding stimulates or crowds out private investment. Cross sectional data at the firm level is used. By apllying parametric and semiparametric selection models, it turns out that public funding increases firms? R&D expenditure. Altough the magnitude of the treatment effect depends on the assumptions imposed by the particular selection model.

Suggested Citation

  • Hussinger, Katrin, 2003. "R&D and Subsidies at the Firm Level: An Application of Parametric and Semi-Parametric Two-Step Selection Models," ZEW Discussion Papers 03-63, ZEW - Leibniz Centre for European Economic Research.
  • Handle: RePEc:zbw:zewdip:1493
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    More about this item

    Keywords

    Innovation; Public R&D Subsidies; Policy Evaluation; Parametric and Semiparametric Two-Step Selection Models;
    All these keywords.

    JEL classification:

    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
    • C24 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Truncated and Censored Models; Switching Regression Models; Threshold Regression Models
    • H32 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - Firm
    • O38 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Government Policy

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