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More R&D with tax incentives? A meta-analysis

Author

Listed:
  • Elina Ladinska
  • Marielle Non

    (CPB Netherlands Bureau for Economic Policy Analysis)

  • Bas Straathof

Abstract

R&D tax incentives are widely used to stimulate private R&D. We review their effectiveness using meta regression analysis. The literature mainly consists of two families of micro-econometric studies. R&D tax incentives are widely used to stimulate private R&D. We review their effectiveness using meta regression analysis. The literature mainly consists of two families of micro-econometric studies. The first family (16 studies with 82 estimates by the end of 2014) estimates the elasticity between the user cost of R&D capital and private R&D expenditure (stock or flow). Correlations between R&D expenditure and the presence of an R&D tax incentive scheme are provided by the second family (9 studies with 95 estimates). For both types of studies we find strong evidence of publication bias. After correcting for this, we find that a reduction in the user cost of capital of ten percent raises stock of R&D capital by 1.3 percent and flow of R&D expenditure by 2.1 percent. For the second family we find that presence of a scheme is associated with seven percent more R&D expenditure.

Suggested Citation

  • Elina Ladinska & Marielle Non & Bas Straathof, 2015. "More R&D with tax incentives? A meta-analysis," CPB Discussion Paper 309, CPB Netherlands Bureau for Economic Policy Analysis.
    • Handle: RePEc:cpb:discus:309
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    References listed on IDEAS

    as
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    Cited by:

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    2. repec:hal:spmain:info:hdl:2441/7rrsl07p559bjr85tr7hsft1o9 is not listed on IDEAS
    3. Annalisa Caloffi & Marco Mariani & Alessandro Sterlacchini, 2016. "Evaluating Public Supports To The Investment Activities Of Business Firms: A Meta-Regression Analysis Of Italian Studies," Working Papers 0116, CREI Università degli Studi Roma Tre, revised 2016.
    4. repec:hal:spmain:info:hdl:2441/4ji8v7q9nt9q0rsm9mqn5dqrrp is not listed on IDEAS
    5. Koen Frenken, 2016. "A Complexity-Theoretic Perspective on Innovation Policy," Papers in Evolutionary Economic Geography (PEEG) 1619, Utrecht University, Department of Human Geography and Spatial Planning, Group Economic Geography, revised Aug 2016.
    6. repec:spo:wpmain:info:hdl:2441/4ji8v7q9nt9q0rsm9mqn5dqrrp is not listed on IDEAS
    7. Koen Frenken, 2016. "A Complexity-Theoretic Perspective on Innovation Policy," Papers in Evolutionary Economic Geography (PEEG) 1619, Utrecht University, Department of Human Geography and Spatial Planning, Group Economic Geography, revised Aug 2016.
    8. Bergner, Sören Martin & Bräutigam, Rainer & Evers, Maria Theresia & Spengel, Christoph, 2017. "The use of SME tax incentives in the European Union," ZEW Discussion Papers 17-006, ZEW - Leibniz Centre for European Economic Research.
    9. Dumont, Michel, 2017. "Assessing the policy mix of public support to business R&D," Research Policy, Elsevier, vol. 46(10), pages 1851-1862.
    10. Daniel Gama e Colombo, 2016. "Impact Assessment of Tax Incentives to Foster Industrial Innovation in Brazil: The Case of Law 11,196/05," Working Papers, Department of Economics 2016_30, University of São Paulo (FEA-USP).
    11. Pfeiffer, Olena & Spengel, Christoph, 2017. "Tax incentives for research and development and their use in tax planning," ZEW Discussion Papers 17-046, ZEW - Leibniz Centre for European Economic Research.
    12. Heike Belitz, 2015. "Steuerliche Förderung von Forschung und Entwicklung: Erfahrungen aus dem Ausland," DIW Roundup: Politik im Fokus 85, DIW Berlin, German Institute for Economic Research.
    13. Blandinieres, Florence & Steinbrenner, Daniela & Weiß, Bernd, 2020. "Which design works? A meta-regression analysis of the impacts of R&D tax incentives," ZEW Discussion Papers 20-010, ZEW - Leibniz Centre for European Economic Research.
    14. Pöschel, Carla, 2020. "Incentive Effects of R&D Tax Incentives: A Meta-Analysis Focusing on R&D Tax Policy Designs," arqus Discussion Papers in Quantitative Tax Research 243, arqus - Arbeitskreis Quantitative Steuerlehre, revised 2020.
    15. repec:spo:wpmain:info:hdl:2441/7rrsl07p559bjr85tr7hsft1o9 is not listed on IDEAS

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    More about this item

    JEL classification:

    • H25 - Public Economics - - Taxation, Subsidies, and Revenue - - - Business Taxes and Subsidies
    • H32 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - Firm
    • 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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