Back to Basics: Basic Research Spillovers, Innovation Policy and Growth
51 Pages Posted: 28 Sep 2013 Last revised: 19 Feb 2021
There are 3 versions of this paper
Back to Basics: Basic Research Spillovers, Innovation Policy and Growth
Back to Basics: Basic Research Spillovers, Innovation Policy and Growth
Back to Basics: Basic Research Spillovers, Innovation Policy and Growth
Date Written: September 2013
Abstract
This paper introduces a general equilibrium model of endogenous technical change through basic and applied research. Basic research differs from applied research in the nature and the magnitude of the generated spillovers. We propose a novel way of empirically identifying these spillovers and embed them in a framework with private firms and a public research sector. After characterizing the equilibrium, we estimate our model using micro-level data on research expenditures by French firms. Our key finding is that standard innovation policies (e.g., uniform R&D tax credits) can accentuate the dynamic misallocation in the economy by oversubsidizing applied research. Policies geared towards public basic research and its transmission to the private sector are significantly welfare improving.
Suggested Citation: Suggested Citation
Do you have a job opening that you would like to promote on SSRN?
Recommended Papers
-
Systemic Risk and Stability in Financial Networks
By Daron Acemoglu, Asuman E. Ozdaglar, ...
-
Systemic Risk and Stability in Financial Networks
By Daron Acemoglu, Asuman E. Ozdaglar, ...
-
Innovation, Reallocation and Growth
By Daron Acemoglu, Ufuk Akcigit, ...
-
Growth Through Heterogeneous Innovations
By Ufuk Akcigit and William Kerr
-
Growth Through Heterogeneous Innovations
By Ufuk Akcigit and William Kerr
-
Growth Through Heterogeneous Innovations
By Ufuk Akcigit and William Kerr
-
Growth Through Heterogeneous Innovations
By Ufuk Akcigit and William Kerr
-
Growth Through Heterogeneous Innovations
By Ufuk Akcigit and William Kerr
-
Innovation by Entrants and Incumbents
By Daron Acemoglu and Dan Cao
-
Innovation by Entrants and Incumbents
By Daron Acemoglu and Dan Cao
