Public funds additionality in R & D expenditure in presence of essential heterogeneity: An empirical investigation using the Italian CIS3 data

Gianluca Papa

ULB Institutional Repository from ULB -- Universite Libre de Bruxelles

Abstract: This paper undertakes an empirical estimation of the additionality of public funding on both the propensity to initiate R & D activity and the intensity of R & D spending of Italian enterprises for the period 1998-2000, using data from the Third Community Innovation Survey and from firms' financial accounts. The chosen methodology (Endogenous Switching Type II-Tobit) takes into account the possibility that decisions about both starting an R & D activity (sample selection effect) and applying for/obtaining public funding (essential heterogeneity) are influenced by private knowledge of enterprises' idiosyncratic propensities in R & D spending. The present analysis shows that both these effects are indeed important and that they contribute to explain most of the additionality found with less sophisticated models. Copyright © 2012 Inderscience Enterprises Ltd.

Keywords: Additionality; CIS; Community Innovation Survey; Endogenous treatment; Essential heterogeneity; Heckman selection models; Italy; Public funds; R & D spending (search for similar items in EconPapers)
Date: 2012-07
Note: SCOPUS: re.j
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Published in: World review of science, technology and sustainable development (2012) v.9 n° 2-4,p.221-253

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