Abstrakti
We construct a model of innovation incorporating R&D externalities, R&D participation, financial market imperfections, and application and allocation of R&D subsidies, estimate it using Finnish R&D project level data and conduct a
welfare analysis. The intensive, not the extensive R&D margin is important. Financial market imperfections are small. Tax credits and subsidies do not reach first best R&D but increase R&D 29-47% compared to laissez-faire. Welfare effects are small: Tax credits increase welfare 1%; subsidies reduce welfare once application costs are taken into account. In terms of fiscal cost, tax credits are 90% more expensive than R&D subsidies.
welfare analysis. The intensive, not the extensive R&D margin is important. Financial market imperfections are small. Tax credits and subsidies do not reach first best R&D but increase R&D 29-47% compared to laissez-faire. Welfare effects are small: Tax credits increase welfare 1%; subsidies reduce welfare once application costs are taken into account. In terms of fiscal cost, tax credits are 90% more expensive than R&D subsidies.
| Alkuperäiskieli | Englanti |
|---|---|
| Kustantaja | Suomen Pankki |
| Sivumäärä | 63 |
| ISBN (elektroninen) | 978-952-323-396-6 |
| Tila | Julkaistu - 18 tammik. 2022 |
| OKM-julkaisutyyppi | D4 Julkaistu kehittämis- tai tutkimusraportti taikka -selvitys |
Julkaisusarja
| Nimi | Bank of Finland Research Discussion Papers |
|---|---|
| Kustantaja | Suomen Pankki |
| Numero | 2 |
| Vuosikerta | 2022 |
| ISSN (elektroninen) | 1456-6184 |