The Review of the Impact of the Tax Incentive Policies and Fiscal Policies on R & D at the Firm Level
International Journal of Economics, Finance and Management Sciences
Volume 7, Issue 1, February 2019, Pages: 1-5
Received: Jan. 31, 2019;
Published: Feb. 1, 2019
Views 132 Downloads 95
Yafeng Hu, School of China Academy of Public Finance and Public Policy, Central University of Finance and Economics, Beijing, P. R. China
Weiguang Ju, Development Research Center of Shandong Provincial People’s Government, Jinan, P. R. China
Ke Gao, Development Research Center of Shandong Provincial People’s Government, Jinan, P. R. China
Based on the research and review of existing literature, this paper finds that the effects of government public policies (including fiscal policies and tax policies) on enterprise innovation can be roughly divided in to the following three categories. Firstly, the government's public policies are encouraging enterprise innovation. When companies are stimulated by public subsidies or tax incentives, they will increase investment in R & D and innovation. Secondly, the government's public policy has inhibited enterprise innovation. When enterprises receive the public subsidies from the government or enjoy the related tax incentives, they often do not increase the investment in research and innovation, but simply reduce the investment on R & D. Thirdly, there is no significant or non-linear relationship between government public policy and enterprise innovation. There is no significant correlation or complex non-linear relationship between whether enterprises increase their investment in R & D innovation and the government's public subsidies and other policies. At the same time, the author found that most of the existing research samples are large enterprises in developed countries. Furthermore, there is a lack of relevant research on small and medium-sized enterprises in developing countries. SMEs account for the vast majority of the whole enterprises, so it is meaningful to study the impact of government subsidies and tax incentives on SMEs' innovation.
The Review of the Impact of the Tax Incentive Policies and Fiscal Policies on R & D at the Firm Level, International Journal of Economics, Finance and Management Sciences.
Vol. 7, No. 1,
2019, pp. 1-5.
Douglas A. Irwin, Peter J. Klenow, High-tech R & D subsidies Estimating the effects of Sematech, Journal of International Economics, Volume 40, Issues 3–4, 1996, 323-344.
Wallsten, S. J. (2000). "The Effects of Government-Industry R & D Programs on Private R & D: The Case of the Small Business Innovation Research Program." The RAND Journal of Economics 31 (1): 82-100.
Theofanis P. Mamuneas, M. IshaqNadiri, Public R & D policies and cost behavior of the US manufacturing industries, Journal of Public Economics, Volume 63, Issue 1, 1996, Pages 57-81.
Holger Görg, Eric Strobl, Do Government Subsidies Stimulate Training Expenditure? Micro econometric Evidence from Plant-Level Data.
Southern Economic Journal Vol. 72, No. 4 (Apr., 2006), pp. 860-876.
Guellec, D. and B. Van Pottelsberghe De La Potterie (2003). "The impact of public R & D expenditure on business R & D." Economics of Innovation and New Technology 12 (3): 225-243.
Wang Min, Li Liang. (2014). Research on the Effect of Tax Preferential Policies to Incentivize SMEs' Technological Innovation. Statistics & Decision. (24):170-173.
Zhou Ming, Wu Cuiqing. (2017). The influence of government subsidies on small and medium － sized enterprise technology innovation. ScienceＲresearch Management 38 (S1):574-580.
LIN Zhou-yu, LIN Han-chuan, et al (2013) Corporate Income Tax Reform and Technological Innovation of Chinese Firms. China Industrial Economics (03):111-123.
LI Wangfu, DU jing, et al (2017). DoＲ＆D Subsidies Ｒeally Stimulate Firms’ R & D Self － financing Investment: New Evidence from China’s Listed Firms. Journal of Financial Research (10):130-145.
Zhang Jie, Chen Zhiyuan, et al. (2015). On Evaluating China’s Innovation Subsidy policy: Theory and Evidence. Economic Research Journal 50 (10):4-17+33.
González, X. and C. Pazó (2008). "Do public subsidies stimulate private R & D spending?" Research Policy 37 (3): 371-389.
David M. Levy, Nestor E. Terleckyj, Effects of Government R & D on Private R & D Investment and Productivity: A Macroeconomic Analysis. The Bell Journal of Economics, Vol. 14, No. 2 (Autumn, 1983), pp. 551-561.
Nadiri, M. Ishaq. "Innovations and Technological Spillovers." National Bureau of Economic Research Working Paper Series No. 4423 (1993).
Falk, Rahel. "Measuring the Effects of Public Support Schemes on Firms’ Innovation Activities: Survey Evidence from Austria." Research Policy 36, no. 5 (2007/06/01/ 2007): 665-79.
Almus, M. and D. Czarnitzki (2003). "The Effects of Public R & D Subsidies on Firms' Innovation Activities." Journal of Business & Economic Statistics 21 (2): 226-236.
Czarnitzki, Dirk, Bernd Ebersberger, and Andreas Fier. "The Relationship between R & D Collaboration, Subsidies and R & D Performance: Empirical Evidence from Finland and Germany." Journal of Applied Econometrics 22, no. 7 (2007/12/01 2007): 1347-66.
Blanes, J. V. and I. Busom (2004). "Who participates in R & D subsidy programs? The case of Spanish manufacturing firms." Research Policy 33 (10): 1459-1476.
Andrew A. Toole (2007). "Does Public Scientific Research Complement Private Investment in Research and Development in the Pharmaceutical Industry?" The Journal of Law and Economics 50 (1): 81-104.
Clausen, T. H. (2009). "Do subsidies have positive impacts on R & D and innovation activities at the firm level?" Structural Change and Economic Dynamics 20 (4): 239-253.
Wolff, G. B. and V. Reinthaler (2008). "The effectiveness of subsidies revisited: Accounting for wage and employment effects in business R & D." Research Policy 37 (8): 1403-1412.
Lerner, Josh, and Julie Wulf. "Innovation and Incentives: Evidence from Corporate R & D." The Review of Economics and Statistics 89, no. 4 (2007/11/01 2007): 634-44.
Cappelen, Å., A. Raknerud, et al. (2012). "The effects of R & D tax credits on patenting and innovations." Research Policy 41 (2): 334-345.
Czarnitzki, D., P. Hanel, et al. (2011). "Evaluating the impact of R & D tax credits on innovation: A micro econometric study on Canadian firms." Research Policy 40 (2): 217-229.
Charles, B. and M. Pierre (2009). "Are firms that receive R & D subsidies more innovative?" Canadian Journal of Economics/Revue canadienned' économique 42 (1): 206-225.