Do R&D subsidies necessarily stimulate economic growth?

Ping-Ho Chen (), Hsun Chu and Ching-chong Lai

MPRA Paper from University Library of Munich, Germany

Abstract: This paper analyzes the growth effect of subsidy policies in a modified R&D-based growth model of Romer (1990), in which both innovation and capital accumulation are engines of long-run economic growth. We show that, under certain conditions, subsidizing the R&D sector may be growth-impeding.

Keywords: R&D; subsidy policy; endogenous growth (search for similar items in EconPapers)
JEL-codes: H2 O3 (search for similar items in EconPapers)
Date: 2015-08
New Economics Papers: this item is included in nep-cse, nep-fdg, nep-gro and nep-ino
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:66061

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