The impact of R&D subsidies on R&D employment composition
Sergio Afcha and José García-Quevedo
CENTRUM Católica’s Working Paper No. 2014-11-0003
DOI: http://dx.doi.org/10.7835/ccwp-2014-11-0003
Abstract
In this paper we examine the impact of subsidies granted at national and regional levels on a set of R&D employment variables and, specifically, we seek to identify the existence of the behavioural additionality effects of these public subsidies on firms’ R&D human resources. We begin by assessing the effects of public funds on R&D private expenditures and on the number of R&D employees, and then focus on their impact on the composition of human resources engaged in R&D as classified by occupation and level of education.
The data used correspond to the Spanish Technological Innovation Panel for the period 2006-2011. To control for selection bias and endogeneity, a combination of non-parametric matching techniques are implemented. After ruling out the existence of crowding out effects, our results show that R&D subsidies increase the number of R&D employees. However, no increase is found in the average level of qualification of R&D staff members in subsidized firms. All in all, the effects of public support are heterogeneous being dependent on the source of the subsidy and the firms’ characteristics.