Evaluating the Impact of Technology Development Funds in Emerging Economies: Evidence from Latin America

33 Pages Posted: 10 Mar 2008 Last revised: 22 Apr 2022

See all articles by Bronwyn H. Hall

Bronwyn H. Hall

University of California at Berkeley; National Bureau of Economic Research (NBER); Institute for Fiscal Studies (IFS); Max Planck Institute for Innovation and Competition

Alessandro Maffioli

Inter-American Development Bank; University of Insubria

Date Written: March 2008

Abstract

Evaluations of government Technology Development Funds (TDF) in Argentina, Brazil, Chile and Panama are surveyed. All the evaluations were done at the recipient (firm) level using data from innovation surveys, industrial surveys, and administrative records of the granting units, together with quasi-experimental econometric techniques to minimize the effects of any selection bias. TDF effectiveness is found to depend on the financing mechanism used, on the presence of non-financial constraints, on firm-university interaction, and on the characteristics of the target beneficiaries. Four levels of potential impact were considered: R&D input additionality, behavioural additionality, increases in innovative output, and improvements in performance. The evidence suggests that TDF do not crowd out private investment and that they positively affect R&D intensity. In addition, participation in TDF induces a more proactive attitude of beneficiary firms towards innovation activities. However, the analysis does not find much statistically significant impact on patents or new product sales and the evidence on firm performance is mixed, with positive results in terms of firm growth, but little corresponding positive impact on measures of firm productivity, possibly because the horizon over which the evaluation was conducted was too short.

Suggested Citation

Hall, Bronwyn H. and Maffioli, Alessandro, Evaluating the Impact of Technology Development Funds in Emerging Economies: Evidence from Latin America (March 2008). NBER Working Paper No. w13835, Available at SSRN: https://ssrn.com/abstract=1104172

Bronwyn H. Hall (Contact Author)

University of California at Berkeley ( email )

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HOME PAGE: http://emlab.berkeley.edu/users/bhhall/index.html

National Bureau of Economic Research (NBER)

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Institute for Fiscal Studies (IFS)

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Max Planck Institute for Innovation and Competition

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Alessandro Maffioli

Inter-American Development Bank ( email )

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United States

University of Insubria ( email )

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Varese, 21100
Italy

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