Template-type: ReDIF-Paper 1.0
Author-Name: Baghana, Rufin
Author-Email: rufin.baghana@finances.gouv.qc.ca
Author-Workplace-Name: Ministère des Finances, Québec
Title: Public R&D Subsidies and Productivity: Evidence from Firm-Level Data in Quebec
Abstract: This paper analyses empirically the impacts of public R&D grants on 
	 private R&D investments and on the productivity growth of the 
	 manufacturing firms in a context where fiscal incentives are present. 
	 Using the conditional semiparametric differenceindifferences estimator 
	 on longitudinal data from Quebec we show that firms that use public 
	 grants for R&D in conjunction with tax credits for R&D perform better in 
	 terms of R&D input additionality than firms that use only tax credits 
	 for R&D. We then use a production function to assess the effectiveness 
	 of public R&D grants in the productivity growth of firms. We find that 
	 for each additional dollar of public R&D grant, output increases by 
	 0.134 dollars. We conclude that the additional return of direct 
	 subsidies is positive but lower than the return on the R&D financed by 
	 own funds or R&D tax credits.
Classification-JEL: H25, O32
Keywords: R&D, Public subsidies, Quebec, Productivity, Difference-in-differences
Series: UNU-MERIT Working Papers
Creation-Date: 2010
Number: 2010-055
File-URL: https://unu-merit.nl/publications/wppdf/2010/wp2010-055.pdf
File-Format: application/pdf
File-Size: 275 Kb
Handle: RePEc:unm:unumer:2010055