The legacy of public subsidies for innovation: input, output and behavioural additionality effects

Stephen Roper, Nola Hewitt-Dundas

Research output: Working paper

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Abstract

In many countries significant amounts of public funding are devoted to supporting firms’ R&D and innovation projects. Here, using panel data on the innovation activities of Irish manufacturing firms we examine the legacy effects of public subsidies for new product development and R&D. We examine five alternative mechanisms through which such effects may occur: input additionality, output additionality, and congenital, interorganisational and experiential behavioural additionality. Tests suggest contrasting legacy effects with R&D subsidies generating legacy output additionality effects while new product development subsidies have legacy congenital and inter-organisational behavioural additionality effects. Our results have implications for innovation policy design and evaluation. 
Original languageEnglish
Place of PublicationWarwick
PublisherEnterprise Research Centre
Number of pages50
Volume21
Publication statusPublished - 26 Feb 2016

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