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How does public support for innovation affect cooperation between firms? Evidence from Uruguay

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  • Flavia Roldán
  • Santiago Acerenza
  • Martín Pereyra
  • Liliana Gelabert

Abstract

In this paper we estimate the behavioural additionally of public support for innovation activities, on the decision to cooperate. Using Uruguayan data from 2007 to 2015, and controlling for endogeneity, we find that public support for innovation increases the likelihood of different types of cooperation agreements. The empirical evidence suggests that public support leads to organizational changes within supported firms that increase their propensity to cooperate with other firms. The implications of these results are relevant for policy design as they contribute to the understanding of the unintended positive (or negative) impacts of public support for innovation on the behaviour of supported firms. We find that the Average Treatment Effect of public support on cooperation is 0.027. Which means that holding everything else constant, public support increases the probability of cooperating by 0.027.

Suggested Citation

  • Flavia Roldán & Santiago Acerenza & Martín Pereyra & Liliana Gelabert, 2022. "How does public support for innovation affect cooperation between firms? Evidence from Uruguay," Asociación Argentina de Economía Política: Working Papers 4594, Asociación Argentina de Economía Política.
    • Handle: RePEc:aep:anales:4594
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    More about this item

    JEL classification:

    • H25 - Public Economics - - Taxation, Subsidies, and Revenue - - - Business Taxes and Subsidies
    • H81 - Public Economics - - Miscellaneous Issues - - - Governmental Loans; Loan Guarantees; Credits; Grants; Bailouts
    • L2 - Industrial Organization - - Firm Objectives, Organization, and Behavior
    • L60 - Industrial Organization - - Industry Studies: Manufacturing - - - General
    • M21 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Economics - - - Business Economics
    • O3 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights

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