Business R&D and the Role of Public Policies for Innovation Support. A Qualitative Approach

Policy makers are paying more attention to changing patterns of business R&D and the effectiveness of policy instruments for creating a supportive climate to encourage business innovation. This paper summarises the findings of qualitative research based on semi-structured interviews which were carried out with Austrian companies in 2002. The research concentrated both on the identification of factors which influence the formulation of internal R&D strategies as well as on the R&D managers' perception of innovation support policies. The interviews indicate that an explanation of growing R&D intensity on a micro-level has to consider both the (external) environment in which the companies operate and their (internal) strategic response. For example, industry trends such as outsourcing of product development within the framework of supplier networks and reduced product life cycles may contribute to higher R&D investments. At the same time, internal decisions (future product portfolio, diversification efforts, etc.) clearly matter when it comes to formulating the R&D strategy and devoting resources to R&D departments. The perception and evaluation of single policy instruments – reducing R&D costs, reducing the risks of R&D and improving the domestic research infrastructure – indicate some of the companies' particular needs. While all instruments are designed to close particular gaps, no single policy measure is capable of meeting the wide range of needs.