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Title:Industrial policy and firm heterogeneity PDF Logo
Authors:Barros, Pedro P.
Nilssen, Tore
Issue Date:1999
Series/Report no.:Memorandum, Department of Economics, University of Oslo 1999,02
Abstract:Our concern is with a firm-specific industrial policy. When R&D subsidies or taxes are differentiated among firms, the question arises which firms in an industry should receive such support. We analyze a situation where firms differ in their R&D technologies in two distinct ways: They differ both in the costs of performing R&D activities and in the output obtained from such activities. We find that the optimal firm-specific industrial policy is affected differently by the two sources of firm heterogeneity. Furthermore, a change in a firm's R&D productivity has an ambiguous effect on the optimal policy towards the firm.
Subjects:firm heterogeneity
industrial policy
R&D
JEL:F13
L52
O31
Document Type:Working Paper
Appears in Collections:Memorandum, Department of Economics, University of Oslo

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