The original intention of the government was to provide financial subsidies to firms by implementing innovation support policies. In turn, this will encourage these firms to carry out technological innovation activities. However, there are still differing views in the academic community on...

This paper studies the welfare effects of Ramp;D subsidies. We develop a model of continuous optimal treatment with outcome heterogeneity where the treatment outcome depends on applicant investment. The model takes into account heterogeneous application costs and identifies the treatment effect...

Governments purchase everything from airplanes to zucchini. This paper investigates the role of the technological content of government procurement in innovation. We theoretically show that a shift in the composition of public purchases toward high-tech products translates into higher...

Direct public support for business R&D is a well-established remedy to market failures, yet empirical evidence on its effectiveness yields conflicting results. The paper investigates the impact of the first European public R&D grant program targeting small and medium enterprises (i.e. the SME...

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...

Drawing on a longitudinal database of Belgian firms over the years 2014-2020, this study investigates the joint effect of R&D grants and R&D tax credits on R&D inputs and innovation outputs. We estimate Conditional Difference-in-Difference (CDiD) models and apply both treatment effects...

The granting of publicly subsidized joint projects has become a popular policy instrument in Germany and other developed countries. However, little is known about how an emerging subsidization network affects the overall allocation process of further project grants. Employing a database that...

Information about the success of a new technology is usually held asymmetrically between the research and development (R&D)-performing firm and potential lenders and investors. This raises the cost of capital for financing R&D externally, resulting in financing constraints on R&D especially for...