Public R&D support and firm performance: A multivariate dose-response analysis

Øivind Nilsen, Arvid Raknerud and Diana-Cristina Iancu

Research Policy, 2020, vol. 49, issue 7

Abstract: We analyse all the major sources of direct and indirect research and development (R&D) support to the business enterprise sector in a single country, Norway, for the period 2002–2013, treating the financial support for R&D from several instruments as a multivariate dose exposure. The output additionality of support to incumbent firms that regularly perform R&D (R&D-incumbents), which obtain about 65 per cent of all R&D support to business enterprises, is insignificant for any instrument or policy mixture. However, the estimated additionality of support to R&D-starters (firms without prior R&D activity), which obtain about 30 per cent of all R&D support, is generally positive. In this firm category, the main instruments for direct R&D support in Norway generate significantly less output and economic activity per NOK 1 million in support than do tax credits, despite the fact these instruments manage large project portfolios at considerable administrative costs. We do not identify positive effects of R&D support on labour productivity or the return on assets for any of the instruments. Our main policy implication is that R&D instruments for the business enterprise sector should be designed in favour of R&D-starters over R&D-incumbents, that is, shifting the focus from the intensive to the extensive margin.

Keywords: R&D; Public policy instruments; Firm performance; Multivariate dose-response; Treatment effects; Matching; Output additionality (search for similar items in EconPapers)
JEL-codes: C33 C52 D24 O38 (search for similar items in EconPapers)
Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (15)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:respol:v:49:y:2020:i:7:s0048733320301451

DOI: 10.1016/j.respol.2020.104067

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