 R&D tax incentivesChapter 51 in Elgar Encyclopedia on the Economics of Knowledge and Innovation, 2022, pp 415-419 from Edward Elgar Publishing Abstract: Tax incentives are widely used to incentivize firms to engage in research and development or to increase their R&D efforts. They can be volume-based or incremental. More and more countries have also adopted the patent box, which is an ex-post tax reward for successful innovators. Two broad methods are used in evaluating the effectiveness of tax incentives: the price elasticity of a user cost of R&D and counterfactual methods. In evaluating tax incentives a major question is whether there is crowding in or crowding out. More thorough evaluations do a cost-benefit analysis incorporating R&D spillover, the cost of financing tax expenditure, as well as administrative and compliance costs in the computation of the bang for the buck. Some studies look beyond the effect on R&D at the effect on innovation and productivity. R&D tax incentives are in principle neutral, but they are sometimes used to stimulate a particular type of R&D. They can also give rise to tax competition to attract R&D performers. Keywords: Business and Management; Economics and Finance; Innovations and Technology (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:elg:eechap:19760_51 Ordering information: This item can be ordered from Access Statistics for this chapter More chapters in Chapters from Edward Elgar Publishing |
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