Evaluating the Robustness of the Effect of Public Subsidies on Firms' R&D: An Application to Italy

Giovanni Cerulli and Bianca Potì

Journal of Applied Economics, 2012, vol. 15, issue 2, 287-320

Abstract: This paper applies different econometric methods to evaluate the effect of public subsidies on firms' R&D activity. For the sake of robustness, results from the Heckman selection model (Heckit), Control-function regression, Difference-in-differences, and various Matching methods are compared by using the third and fourth wave of the Italian Community Innovation Survey (CIS3, years 1998–2000 and CIS4, years 2002–2004). We predict the absence of a full crowding-out of private R&D performance, both for the whole sample and for some subsets of firms. Nevertheless, we conclude that while for variables expressed as ratio (R&D intensity and R&D per employee) the difference in results is negligible, R&D expenditure presents a strong variability among the approaches, even for those relying on similar identification assumptions. Given the utmost importance of this target-variable, future works should go beyond the use of single methods, especially when they are thought of to steer future policymaking.

Date: 2012
References: Add references at CitEc
Citations: View citations in EconPapers (35)

Downloads: (external link)
http://hdl.handle.net/10.1016/S1514-0326(12)60013-0 (text/html)
Access to full text is restricted to subscribers.

Related works:
Journal Article: Evaluating the robustness of the effect of public subsidies on firms’ R&D: an application to Italy (2012)
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:taf:recsxx:v:15:y:2012:i:2:p:287-320

Ordering information: This journal article can be ordered from
http://www.tandfonline.com/pricing/journal/recs20

DOI: 10.1016/S1514-0326(12)60013-0

Access Statistics for this article

Journal of Applied Economics is currently edited by Jorge M. Streb

More articles in Journal of Applied Economics from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().