Innovation, job creation and productivity: implications for public policy

Mehmet Ugur ()

No 19096, Greenwich Papers in Political Economy from University of Greenwich, Greenwich Political Economy Research Centre

Abstract: Direct and indirect public support (subsidies and tax relief) for business R&D in the UK is higher than most other OECD countries. Nevertheless, total business R&D expenditure as percentage of GDP in the UK (1.7%) is relatively low compared to OECD countries (2.43%). This policy brief summarizes the findings from an ESRC-funded research project on productivity and employment effects of R&D investment; and on whether direct public support has had additionality effects in terms of increasing the funded firms’ R&D investment. The findings suggest that the bot the effects of R&D on productivity and employment and the effect of subsidies on private R&D effort are heterogeneous and non-linear. Therefore, we call for well-targeted R&D subsidies, new conditionality clauses taking account of past performance, and industry-specific targets for R&D investment.

Keywords: Innovation; R&D; Employment; Productivity; Public Policy (search for similar items in EconPapers)
JEL-codes: D24 J23 O30 O32 O38 (search for similar items in EconPapers)
Date: 2018-01-25
New Economics Papers: this item is included in nep-cse, nep-eur, nep-ino, nep-ppm, nep-sbm and nep-tid
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Persistent link: https://EconPapers.repec.org/RePEc:gpe:wpaper:19096

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