Title: Do incentives to industrial R&D enhance research productivity and firm growth? Evidence from the Italian case

Authors: Monica Merito, Silvia Giannangeli, Andrea Bonaccorsi

Addresses: Scuola Superiore di Studi Universitari e di Perfezionamento 'Sant'Anna' di Pisa, Piazza Martiri della Liberta 33 50127 Pisa, Italy. ' Scuola Superiore di Studi Universitari e di Perfezionamento 'Sant'Anna' di Pisa, Piazza Martiri della Liberta 33 50127 Pisa, Italy. ' Universita di Pisa, Facolta di Ingegneria, via Diotisalvi 2, 56126 Pisa, Italy

Abstract: This paper aims at contributing to the empirical literature about the impact of R&D subsidies on firm performance by providing recent micro-evidence from Italy. We evaluate grant effects on the innovation and market results of firms selected for funding in the short and medium run using a counterfactual approach. Results show that the innovative performance improves only temporarily and no significant differences between grant recipients and non-recipients emerge as far as labour productivity and sales growth are concerned. Rather, a growth in qualified employment is observed among SMEs.

Keywords: bias-corrected matching; company performance; research and development; R&D subsidies; Italy; grants; innovation; employee productivity; small and medium-sized enterprises; SMEs; small firms; employee qualifications.

DOI: 10.1504/IJTM.2010.029409

International Journal of Technology Management, 2010 Vol.49 No.1/2/3, pp.25 - 48

Published online: 30 Nov 2009 *

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