Econometric Evaluation of Public Policies for Science and Innovation : A Brief Guide to Practice

This work reviews the principal econometric methods used to measure the effects of public R&D subsidies on firm performance. First, we show the main econometric challenges a researcher has to face in estimating the impact of a government policy scheme, by paying special attention to the issues of subsidy endogeneity and selection bias. Then, we review the main features of different methods. A discussion of advantages and drawbacks of each approach is offered to the reader, as well as suggestions for future improvements in this field of economic research