OECD Science, Technology and Industry Working Papers

ISSN: 
1815-1965 (online)
http://dx.doi.org/10.1787/18151965
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The OECD Directorate for Science, Technology and Innovation (STI) leads OECD research on the contribution of science, technology and industry to well-being and economic growth. STI Working Papers cover a broad range of topics including definition and measurement of science and technology indicators, global value chains, and research on policies to promote innovation. These technical or analytical working papers are prepared by staff or outside consultants to share early insights and elicit feedback.
 

The Impact of Public R&D Expenditure on Business R&D You or your institution have access to this content

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Author(s):
Dominique Guellec, Bruno van Pottelsberghe de la Potterie
14 June 2000
Bibliographic information
No:
2000/04
Pages:
26
http://dx.doi.org/10.1787/670385851815

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This document attempts to quantify the aggregate net effect of government funding on business R&D in 17 OECD Member countries over the past two decades. Grants, procurement, tax incentives and direct performance of research (in public laboratories or universities) are the major policy tools in the field. The major results of the study are the following:

  • Direct government funding of R&D performed by firms (either grants or procurement) has a positive effect on business financed R&D (one dollar given to firms results in 1.70 dollars of research on average).
  • Tax incentives have a positive (although rather short-lived) effect on business-financed R&D.
  • Direct funding as well as tax incentives are more effective when they are stable over time: firms do not invest in additional R&D if they are uncertain of the durability of the government support.
  • Direct government funding and R&D tax incentives are substitutes: increased intensity of one reduces the effect of the other on business R&D.
  • The ...
 
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