Are Incentives for R&amp;D Effective? Evidence from a Regression Discontinuity Approach

Bronzini, Raffaello; Iachini, Eleonora

doi:10.2139/ssrn.1829994

Cited by 76 publications

(37 citation statements)

References 112 publications

(5 reference statements)

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“…Almus and Czarnitzki, 2003;Hyytinen and Toivanen, 2005;Czarnitzki, 2006;Görg and Strobl, 2007;Özçelik and Taymaz, 2008;Aerts and Schmidt, 2008;Hussinger, 2008;Meuleman and Maeseneire, 2012;Czarnitzki and Lopes-Bento, 2013), but studies have also found that these funds partly or fully crowd out some private investments (e.g. Wallsten, 2000;Lach, 2002;Busom, 2000;González and Pazó, 2008;Gelabert et al, 2009 Bronzini andIachini, 2014). qua and Pellegrini, 2014).…”

Section: Introductionmentioning

confidence: 99%

R&D subsidies and productivity in SMEs

Karhunen

Huovari

2015

Small Bus Econ

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This dissertation consists of an introductory chapter and four separate empirical studies which study higher education and productivity in Finland. Introductory chapter presents shortly the motivation, background and main results of this thesis. First three articles focus on the relationship between working while studying, dropout behavior and later labor market outcomes at individual level. Fourth article examines how subsidies affect labor productivity at the firm level.The first article of this thesis studies how working while studying relates to earnings after graduation from university or polytechnic. Analysis focuses on working while studying and earnings over two year period after graduation. The results show that early work experience is related to higher earnings right after graduation year, but instrumental variable estimations find no significant causal effect for university students.The second article explores on the relationship between working while studying and migration. Migration propensities are studied up to three years after graduation. Results show that working while studying can partly explain why the mobility of highly educated people has declined. We find that that there are differences by study region and earlier migration behavior.The third article examines the relationship between the decision to drop out from university and labor market outcomes. Results indicate that compared to similar university graduates, the dropouts' annual earnings are on average 11,000 euros lower four years after the dropout decision. Dropouts have also a higher probability of being self-employed than similar graduates.The fourth article examines the effect of R&D subsidies on labour productivity. Study uses firm-level data on Finnish SMEs from 2000 to 2012 and apply a combined matching and difference-in-differences method to control for selection bias. Study does not find significant positive effect on labour productivity over the five-year period after a subsidy is granted.

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Section: Introductionmentioning

confidence: 99%

R&D subsidies and productivity in SMEs

Karhunen

Huovari

2015

Small Bus Econ

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“…The positive effect was observed only in the group of smaller firms; a strong negative effect was in larger firms [1].…”

Section: Current Literaturementioning

confidence: 81%

Innovation activities of firms: the case of 8 cis waves in the Czech industry between 2001 and 2014

Vokoun

2017

SHS Web Conf.

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Abstract. Eight Czech CIS waves between 2001-2014 were analyzed. An adjusted (incomplete) CDM model was used to estimate effects of characteristics of firms (firm size, government funding, market orientation, or foreign ownership) on the innovation process (decision to innovate, R&D intensity, sales from innovated goods). Public support had a very limited or even negative effect on innovation inputs and outputs. This analysis suggests that there is no relationship between R&D expenditures and sales of innovated goods. The coefficients are quite similar for new-tothe-market innovators and new-to-the-enterprise innovators. The orientation of the world market is a highly important factor of new-to-themarket innovators. The ability to capture sales of innovated goods is higher for smaller firms, but only for the new-to-the-firm innovators. The analysis also showed differences between innovators in service sector and manufacturing sector. Cooperation is a positive factor of innovation intensity in the manufacturing sector; however on average, there is zero effect of cooperation in the service sector. World market orientation is a key factor of service companies.

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“…Because of this, he divides the firms into groups on the basis of sales and calculated heteroskedastic-consistent standard error. Bronzini and Iachini (2011) scale all variables with sales. 15 Formal tests show that this procedure works very well compared both to no weighting and to scaling all variables with sales.…”

Section: Baseline Modelmentioning

confidence: 99%

“…Garcia-Quevedo (2004) conducts a meta-analysis of 74 results from 39 studies, and concludes similarly that "the econometric evidence … is ambiguous". Finally, Bronzini and Iachini (2011) list eleven papers published during the last decade and find that only half of them confirm a positive role for public R&D incentives. Given the large amount of public resources devoted to R&D subsidies in all OECD economies, it is important to resolve this ambiguity.…”

Section: Introductionmentioning

confidence: 99%

“…Although Jaffe's article is well cited, we are only aware of three studies that try to implement his estimation strategy; Jacob and Lefgren (2011), Benavente, Crespi, and Maffioli (2012) and Bronzini and Iachini (2011). 1 The first two studies evaluate funding of academic research while Jaffe's main concern was the effectiveness of support to commercial R&D. Bronzini and Iachini (2011) analyze subsidies to commercial R&D, but lack data for the firms' R&D investments. Instead, they rely on balance sheet data and use investmentsintangible, tangible and total -as their preferred outcome variable.…”

Section: Introductionmentioning

confidence: 99%

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Estimating the additionality of R&D subsidies using proposal evaluation data to control for research intentions

2014

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Empirical examination of whether R&D subsidies crowd out private investments has been hampered by selection problems. A particular worry is that project quality and research intentions may be correlated with the likelihood of receiving subsidies. Using proposal evaluation data to control for research intentions, we do not find strong evidence suggesting that this type of selection creates a severe bias. Proposal evaluation grades strongly predict R&D investments and reduce selection bias in cross-sectional regressions, but there is limited variation in grades within firms over time. Hence, in our sample, unobserved project quality is largely absorbed by firm fixed effects. Our best estimate of the short-run additionality of R&D subsidies is 1.15, i.e., a one-unit increase in subsidy increases total R&D expenditure in the recipient firm by somewhat more than a unit. We demonstrate, however, that there is measurement error in the subsidy variable. Additionality is therefore likely to be underestimated. JEL CLASSIFICATION: O38, O32, L53, H25, H32

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Are Incentives for R&D Effective? Evidence from a Regression Discontinuity Approach

Cited by 76 publications

References 112 publications

R&D subsidies and productivity in SMEs

R&D subsidies and productivity in SMEs

Innovation activities of firms: the case of 8 cis waves in the Czech industry between 2001 and 2014

Estimating the additionality of R&D subsidies using proposal evaluation data to control for research intentions

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