DOES THE EFFECT OF PUBLIC SUPPORT FOR R&D DEPEND ON THE DEGREE OF APPROPRIABILITY?

Authors


  • *We gratefully acknowledge financial support from the Fundación Ramón Areces and research assistance from the Spanish National Institute of Statistics (INE). We would like to thank C. Alonso, A. Arora, M. Bagüés, R. Carrasco, W. Cohen, M. Giarratana, R. Fontana, J. Jaumandreu, P. Ruiz-Verdú, O. Toivanen, F. Warsynski, the Editor, an anonymous referee, and seminar participants at the Universidad Carlos III de Madrid, Universidad Internacional Menendez Pelayo (Escuela de Economía de la Innovación Zvi Griliches), Universitat Autònoma de Barcelona, Universidad de Vigo, 2006 EURAM Conference (Oslo), 2006 DRUID Summer Conference (Copenhagen), 2006 EARIE Conference (Amsterdam), and 2006 Jornadas de Economía Industrial (Barcelona), for comments and suggestions on a previous draft. The usual disclaimer applies.

Abstract

We explore the interaction between public support for R&D and appropriability using a dataset constructed from the Spanish Community Innovation Survey, for the period 2000–2005. We find that public support policy is less able to stimulate privately financed internal R&D in firms where appropriability mechanisms are more effective. On average, the effect of public support for R&D is three times larger for those firms reporting a level of appropriability below the median vis-à-vis those firms for which appropriability is above the median level. Furthermore, for supported firms with the highest degree of appropriability, crowding out cannot be ruled out.

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