Promoting Innovation: The Differential Impact of R&D Subsidies

Cherif, Reda, Grimpe, Christoph, Hasanov, Fuad and Sofka, Wolfgang
(2023) Promoting Innovation: The Differential Impact of R&D Subsidies. JOURNAL OF INDUSTRY COMPETITION & TRADE, 23 (3-4). pp. 187-241.

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We investigate the effect of R&D subsidies on firms’ innovation by ownership, industry, and firm size using German firm-level data. The impact of R&D subsidies is heterogeneous across industries for multinational corporations (MNCs) and domestic firms. This heterogeneity is robust using various estimators. Domestic firms have a larger response in R&D spending in low-tech and medium-term manufacturing, while the effect in high-tech manufacturing is larger for both domestic and foreign MNCs. In knowledge-intensive services and technological services, the response of domestic firms and in some cases foreign MNCs, is greater than that of domestic MNCs. In terms of patents, foreign MNC subsidiaries tend to have a larger count in high-tech manufacturing.

Item Type: Article
Uncontrolled Keywords: Innovation, Investment, Multinationals, Patents, R & D, Research and development, Subsidies, Technology policy
Divisions: Faculty of Humanities and Social Sciences > School of Management
Depositing User: Symplectic Admin
Date Deposited: 18 Mar 2024 16:39
Last Modified: 19 Jun 2024 14:27
DOI: 10.1007/s10842-023-00400-7
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