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Evaluating the impact of innovation incentives: evidence from an unexpected shortage of funds

Author

Listed:
  • Guido de Blasio
  • Davide Fantino
  • Guido Pellegrini

Abstract

To evaluate the effect of an R&D subsidy, one needs to know what the subsidized firms would have done without the incentive. This article studies an Italian program of subsidies for the applied development of innovations, exploiting a discontinuity in program financing due to an unexpected shortage of public money. To identify the effect of the program, the study implements a regression discontinuity design and compares firms that applied before and after the shortage occurred. The results indicate that the program was not effective in stimulating innovative investment.

Suggested Citation

  • Guido de Blasio & Davide Fantino & Guido Pellegrini, 2015. "Evaluating the impact of innovation incentives: evidence from an unexpected shortage of funds," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 24(6), pages 1285-1314.
    • Handle: RePEc:oup:indcch:v:24:y:2015:i:6:p:1285-1314.
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    More about this item

    JEL classification:

    • O32 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Management of Technological Innovation and R&D
    • O38 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Government Policy

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