Innovation Policy and Economic Growth

Dirk Czarnitzki and Otto Toivanen

No 482, European Economy - Economic Papers 2008 - 2015 from Directorate General Economic and Financial Affairs (DG ECFIN), European Commission

Abstract: This paper establishes theoretically a link between investments in economic growth and investments in R and D. This raises the importance of innovation policies as they are designed to narrow the gap between the socially optimal and the privately optimal levels of R and D. As innovation policies may be subject to crowding-out effects, we, second, empirically test whether R and D subsidies stimulate private investment in two countries of the European economic area. We employ Belgian and German firm level data for estimating treatment effects models. It turns out that public R and D grants stimulate private investments in both countries. Furthermore, the estimated treatment effects vary with the innovation experience of firms and their past labor productivity.

JEL-codes: G38 H25 L59 O31 O38 (search for similar items in EconPapers)
Pages: 44 pages
Date: 2013-04
New Economics Papers: this item is included in nep-cse, nep-ino and nep-pbe
References: Add references at CitEc
Citations: View citations in EconPapers (4)

Downloads: (external link)
https://ec.europa.eu/economy_finance/publications/ ... r/2013/ecp482_en.htm (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:euf:ecopap:0482

Access Statistics for this paper

More papers in European Economy - Economic Papers 2008 - 2015 from Directorate General Economic and Financial Affairs (DG ECFIN), European Commission Contact information at EDIRC.
Bibliographic data for series maintained by ECFIN INFO ().