Understanding R&D Policy: Efficiency or Politics?

Fidel Perez-Sebastian
Authors registered in the RePEc Author Service: Fidel Perez Sebastian

Review of Economics and Institutions, 2012, vol. 3, issue 3

Abstract: This paper searches for the determinants of government-funded R&D. The goal is to disentangle whether the efficiency considerations overwhelmingly emphasized by the theoretical literature are indeed the main driving force behind public R&D expenditures. Another goal of the paper is to assess whether other types of innovation policy such as the degree of patent protection can have an impact on private R&D. I find that there are important differences between rich and poor nations at this respect. In particular, R&D-specific efficiency factors are not significant to explain public R&D in rich nations, whereas related variables such as the access to private credit are important in less developed economies; in rich countries, public innovation effort can be better explained by the political economy variables that determine the size of governments. Private R&D, on the other hand, depends in high income economies on R&D policies not related to direct public innovation effort, but is highly determined by this variable in developing countries. Results suggest that more research on political economy theories of innovation is essential to understand R&D investment.

Keywords: R&D; policy; market failures; political factorsn (search for similar items in EconPapers)
JEL-codes: O30 O38 O40 (search for similar items in EconPapers)
Date: 2012
References: Add references at CitEc
Citations:

Downloads: (external link)
https://rei.unipg.it/rei/article/view/90
Requires registration. Users must be registered and log in to access full text

Related works:
Working Paper: Understanding R&D Policy: Efficiency or Politics? (2011)
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:pia:review:v:3:y:2012:i:3:n:2

Access Statistics for this article

Review of Economics and Institutions is currently edited by Carlo Andrea Bollino

More articles in Review of Economics and Institutions from Università di Perugia Contact information at EDIRC.
Bibliographic data for series maintained by Ubaldo Pizzoli ().