The Relationship between R&D Collaboration, Subsidies and R&D Performance: Empirical Evidence from Finland and Germany

Abstract:     
This study focuses on the impact of innovation policies and R&D collaboration in Germany and Finland. We consider collaboration and subsidies as heterogeneous treatments, and perform an econometric matching to analyze R&D and patent activity at the firm level. In general, we find that collaboration has positive effects. In Germany, subsidies for individual research do neither exhibit a significant impact on R&D nor on patenting, but the innovative performance could be improved by additional incentives for collaboration. For Finnish companies, public funding is an important source of finance for R&D. Without subsidies, recipients would show less R&D and patenting activity, whilst those firms not receiving subsidies would perform significantly better if they were publicly funded.

Keywords: R&D, Public Subsidies, Collaboration, Policy Evaluation

JEL Classification: C14, C25, H50, O38

Accepted Paper Series