Influence of R&D subsidies on efficiencythe case of Spanish manufacturing firms

  1. Jorge Moreno, Justo de
  2. Suárez Gálvez, Cristina Isabel
Journal:
Cuadernos de economía y dirección de la empresa

ISSN: 1138-5758

Year of publication: 2011

Volume: 14

Issue: 3

Pages: 185-193

Type: Article

DOI: 10.1016/J.CEDE.2010.11.001 DIALNET GOOGLE SCHOLAR lock_openDialnet editor

More publications in: Cuadernos de economía y dirección de la empresa

Sustainable development goals

Abstract

This study provides new evidence about the effects of subsidies for research and development (R&D) on technical efficiency in a sample of Spanish manufacturers during the period 1993-2002. The results suggest two issues to consider. Firstly, the beneficiary firms of subsidies are less efficient; to avoid this effect, this result should serve to as a guide to authorities, with the aim of improving the allocation of these resources. Secondly, less efficient firms are those that are unable to obtain resources to fund R&D or obtain credit and are therefore those that apply for subsidies. In light of these results, the subsidies received by Spanish manufacturing firms may be insufficient or may fail to arrive when required, hampering the fulfilment of their objectives.

€ View funding

Funding information

The author recognises the support received from the Regional Government of Castille-La Mancha (Spain).

Funders

Bibliographic References

  • Amit, R., Schoemaker, P., 1993. Strategic Assets and Organizational Rent. Strategic Management Journal 14, 33-46.
  • Barney, J.B., 1986. Strategic Factor Markets: Expectations, Luck, and Business Strategy. Management Science 32, 1231-1241.
  • Battese, G.E., Broca, S.S., 1997. Functional forms of stochastic frontier production functions and models for technical inefficiency effects: a comparative study for wheat farmers in Pakistan. Journal of Productivity Analysis 8, 395-414.
  • Battese, G.E., Coelli, T.J., 1995.Amodel for technical inefficiency effects in a stochastic frontier production function for panel data. Empirical Economics 20, 325-332.
  • Battese, G.E., Corra, G.S., 1977. Estimation of a production frontier model: With application to the Pastoral Zone of Eastern Australia. Australian Journal of Agricultural Economics 21, 169-179.
  • Blanes, J.V., Busom, I., 2004. Who Participates in R&D Subsidy Programs? The case of Spanish Manufacturing Firms. Research Policy 33, 1459-1476.
  • Bosch, N., Pedraja, F., Suarez, J., 1998. La medición de la eficiencia en la Prestación de los Servicios Públicos Locales: El Caso del Servicio de Recogida de Basuras. Fundación BBV, Bilbao.
  • Busom, I., 1991. Impacto de las ayudas públicas a las actividades de I +D de las empresas: un análisis empírico. Revista de Economía Pública 11, 47-65.
  • Busom, I., 2000. An Empirical Evaluation of the Effects of R&D Subsidies. Economics of Innovation and New Technology 9, 111-148
  • Cotec, 2000. Relaciones para la innovación de las empresas con las administraciones. Fundación Cotec, Madrid.
  • David, P.A., Hall, B.H., Toole, A.A., 2000. Is public R&D a complement or substitute for private R&D? A review of econometric evidence. Research Policy 29, 497-529.
  • Delgado, M., Fariñas, J.C., Ruano, S., 2002. Firms productivity and export markets: a nonparametric approach. Journal of International Economics 57, 397-422.
  • Díaz, M.A., Sánchez, R., 2004. Temporary employment and technical efficiency in Spain. International Journal of Manpower 25, 181-194.
  • Díaz, M.A., Sánchez, R., 2008. Firm size and productivity in Spain: a stochastic frontier analysis. Small Business Economics 30, 315-323.
  • Dierickx, I., Cool, K., 1989. Asset Stock Accumulation and Sustainability of Competitive Advantage. Management Science 35, 1504-1511.
  • Fariñas, J.C., Jaumandreu, J., 1999. Diez años de Encuesta sobre Estrategias Empresariales (ESEE). Economía Industrial 329, 29-42.
  • Feldman, M.P., Kelley, M.R., 2003. Leveraging research and development: assessing the impact of the U.S. advanced technology program. Small Business Economics 20, 153-165.
  • Fernández, E., Junquera, B., Vazquez, C., 1995. La política de I +D en la empresa no financiera. Información Comercial Española 81, 104-117.
  • Freeman, C., 1994. Innovation and Growth. En: Dodgson, M., Rothwell, R. (Eds.), The Handbook of industrial innovation. Elgar, Aldershot.
  • Georghiou, L., Clarysse, B., Steurs, G., Bilsen, V., Larosse, J., 2004. Making the difference: The evaluation of behavioural additionality of R&D subsidies. IWT-Studies 48, Bruselas.
  • González, X., Jaumandreu, J., Pazo, C., 2005. Barriers to Innovation and Subsidy Effectiveness. Rand Journal of Economics 36, 930-950.
  • Griliches, Z., 1986. Productivity, R&D, and basic research at the firm level in the 1970s. American Economic Review 76, 141-154.
  • Grossman, G.M., Helpman, E., 1991. Endogenous Growth Theory. Mit Press, Cambridge.
  • Gumbau, M., 1998. La eficiencia técnica de la industria española. Revista Española de Economía 1, 67-84.
  • Gumbau, M., Maudos, J., 2002. The determinants of efficiency: the case of Spanish industry. Applied Economics 34, 1941-1948.
  • Hall, P., 1994. Innovation, Economics and evolution: Theoretical perspectives on changing technology in economics system. Harvester Wheatsheaf, Nueva York.
  • Heijs, J., 2003. Freerider behaviour and the public finance of R&D activities in enterprises: the case of the Spanish low interest credits for R&D. Research Policy 32, 445-461.
  • Hsu, F.M., Horng, D.J., Hsueh, C.C., 2009. The effect of government-sponsored R&D programmes on additionality in recipient firms in Taiwan. Technovation 29, 204-217.
  • Huang, C.C., Chu, P.Y., Chiang, Y.H., 2008. A fuzzy AHP application in governmentsponsored R&D project selection. Omega 36, 1038-1052.
  • Klette, J., Moen, J., Griliches, Z., 2000. Do subsidies to commercial R&D reduce market failures? Microeconomic evaluation studies. Research Policy 29, 471-495.
  • Lichtenberg, F.R., 1987. The effect of government funding on private industrial research and development: A re-assessment. Journal of Industrial Economics 36, 342-349.
  • Lieberman, M., Dhawan, R., 2005. Assessing the Resource Base of US and Japanese Automakers: A Stochastic Frontier Production Function Approach. Management Science 51, 1060-1075.
  • Lucas, R.E., 1988. On the mechanics of economic development. Journal of Monetary Economics 22, 3-42.
  • Luukkonen, T., 1998. The difficulties in assessing the impact of EU framework programmes,. Research Policy 27, 599-610.
  • Luukkonen, T., 2000. Additionality of EU framework programmes. Research Policy 29, 711-724.
  • Mañez, J.A., Rincón, A., Rochina, M.E., Sanchis, J.A., 2005. Productividad e I +D: Un análisis no paramétrico. Revista de Economía Aplicada 39, 47-86.
  • Marra, M.A., 2006. Efectos de las subvenciones públicas sobre la inversión en I +D de las empresas manufactureras españolas. Revista Galega de Economía 15, 1-20.
  • Martín, A., Suárez, C., 2000. Technical efficiency of Spanish manufacturing firms: A panel data approach. Applied Economics 32, 1249-1258.
  • Nelson, R.R., Winter, S.G., 1982. An evolutionary theory of economic change. Harvard University Pres, Cambridge.
  • OECD, 2006. Government R&D Funding and Company Behaviour-Measuring Behavioural Additionality. Organization for Economic Cooperation and Development, París.
  • Pereiras, S., Huergo, E., 2006. La financiación de actividades de investigación, desarrollo e innovación: una revisión de la evidencia sobre el impacto de las ayudas públicas. In: Documentos de trabajo: 01. CDTI, Madrid.
  • Peteraf, M., 1993. The Cornerstones of Competitive Advantage: A Resource-Based View. Strategic Management Journal 14, 179-191.
  • Rodríguez, L., 1989. Efectos individuales en la estimación de elasticidades de sustitución: grandes empresas industriales españolas 1979-1981. Revista Española de Economía 5, 138-153.
  • Romer, P.M., 1986. Increasing returns and long run growth. Journal of Political Economy 94, 1002-1037.
  • Romer, P.M., 1990. Endogeneus technological change. Journal of Political Economy 98, 71-102.
  • Rumelt, R.P., 1987. Theory, Strategy, and Entrepreneurship. En: Teece, D. (Ed.), The Competitive Challenge: Strategies for Industrial Innovation and Renewal. Ballinger, Cambridge, MA.
  • Sanz-Menéndez, L., 1995. Policy choices, institutional constraints and policy learning: the Spanish science and technology policy in the eighties. International Journal of Technology Management 10, 622-641.
  • Silverman, B.W., 1986. Density estimation for statistics and data analysis. Chapman and Hall, Londres.
  • Smith, A., 1776. The wealth of nations. Hayes Barton Press, Nueva York.
  • Toole, A.A., Turvey, C., 2009. How does initial public financing influence private incentives for follow-on investment in early-stage technologies? Journal Technological Transfer 34, 43-58.
  • Zellner, A., Kmenta, J., Dreze, J., 1966. Specification and estimation of Cobb-Douglas production functions. Econometrica 34, 784-795.
Data source: Dialnet