Taxation, R&D tax incentives and patent application in Europe

Christof Ernst and Christoph Spengel

No 11-024, ZEW Discussion Papers from ZEW - Leibniz Centre for European Economic Research

Abstract: The focus of this paper is on effects from tax incentives for research and development inputs (R&D) and corporate income tax on business R&D and patenting behaviour. First, we provide a theoretical discussion of tax planning with R&D and intellectual property (IP) ownership. Further, we employ firm-specific micro-data on patent applications of European corporations at the European Patent Office to test reactions on changes in R&D tax incentives and corporate tax burden. We find a positive impact of R&D tax incentives and a negative impact of the statutory corporate income tax rate on patenting. R&D incentives rather influence the tendency to invest in R&D, whereas the tax burden rather influences the scale of R&D investment and the count of patent applications.

Keywords: Patent; R&D; Tax Incentives; Taxation; EU (search for similar items in EconPapers)
JEL-codes: H25 H26 O30 (search for similar items in EconPapers)
Date: 2011
New Economics Papers: this item is included in nep-acc, nep-eur, nep-ino, nep-ipr, nep-pr~, nep-pbe, nep-pub, nep-sbm and nep-tid
References: View complete reference list from CitEc
Citations: View citations in EconPapers (38)

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Persistent link: https://EconPapers.repec.org/RePEc:zbw:zewdip:11024

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