This paper reconsiders the explanation of R&D subsidies by Spencer and Brander (1983) and others by allowing firms to license their innovations and to pool their R&D investments. We show that in equilibrium R&D joint ventures are formed and licensing occurs in a way that eliminates the strategic...

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...