Policy incentives for private innovation and maximising the returns

Ben Westmore

OECD Journal: Economic Studies, 2014, vol. 2013, issue 1, 121-163

Abstract: This paper uses panel regression techniques to assess the policy determinants of private-sector innovative activity – proxied by R&D expenditure and the number of new patents – across 19 OECD countries. The relationship between innovation indicators and multifactor productivity (MFP) growth is also examined with a particular focus on the role of public policies in influencing the returns to new knowledge. The results establish an empirical link between R&D and patenting, as well as between these measures of innovation intensity and MFP growth. Innovation-specific policies such as R&D tax incentives, direct government support and patent rights are found to be successful in encouraging the innovative activities associated with higher productivity growth. However, direct empirical evidence of the positive effects of these policies on productivity is less forthcoming. A pervasive theme from the analysis is the importance of coupling policies aimed at encouraging innovation or technological adoption with well-designed framework policies that allow knowledge spillovers to proliferate. In particular, the settings of framework policies relating to product market regulation, openness to trade and debtor protection in bankruptcy provisions are found to be important for the diffusion of new technologies. JEL classification: L20, O30, O40 Keywords: Intangible assets, innovation, productivity growth, public policy

Date: 2014
References: Add references at CitEc
Citations: View citations in EconPapers (8)

Downloads: (external link)
https://doi.org/10.1787/eco_studies-2013-5k3trmjlhxzq (text/html)
Full text available to READ online. PDF download available to OECD iLibrary subscribers.

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:oec:ecokac:5k3trmjlhxzq

Access Statistics for this article

More articles in OECD Journal: Economic Studies from OECD Publishing Contact information at EDIRC.
Bibliographic data for series maintained by ().