This paper introduces an extended structural innovation model à la Crépon et al. (1998), adapted to study empirically the process of indigenous innovation and catch-up in a developing economy context. Specifically, three key extensions to the original model are introduced in order to study how...

Relying on firm-level data from China, this paper combines matching techniques with a structural framework to study the effects of public subsidies across multiple stages of innovation and the implications for productivity. The findings reveal that public subsidies reduce firms' economic...