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- W3126093733 abstract "We show theoretically that a proportional R&D subsidy accelerates innovation activity at all degrees of competition in the modern Schumpeterian growth model, but less so at high degrees of competition. We then use company-level data on patenting activity, product market competition and R&D subsidies of Finnish firms during 1990 2001 to test the theoretical prediction. The empirical findings can be summarized as follows. Firstly, we find relatively strong evidence in favour of the inverted U-shape between competition and innovation. Secondly, we find some evidence that a direct R&D subsidy increases innovative activity at all but very high degrees of competition. This can be interpreted so mean that the R&D subsidy reinforces the Schumpeterian effect due to the negative cross-effect of R&D subsidy and competition. This is evident from the finding that an increase in the R&D subsidy steepens the inverted U relationship when competition is fierce. Keywords: competition, innovation, R&D subsidies, patents" @default.
- W3126093733 created "2021-02-01" @default.
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- W3126093733 date "2007-04-01" @default.
- W3126093733 modified "2023-09-27" @default.
- W3126093733 title "When do R&D subsidies boost innovation?: revisiting the inverted U-shape" @default.
- W3126093733 hasPublicationYear "2007" @default.
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