Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/192553 
Year of Publication: 
2008
Series/Report no.: 
Discussion Papers No. 571
Publisher: 
Statistics Norway, Research Department, Oslo
Abstract: 
An important policy question is whether research and development (R&D) in new, emerging technologies should be more subsidized than R&D in other more mature technologies. In this paper I analyze if innovation externalities caused by knowledge spillovers from private firms may warrant a differentiated R&D policy. I find that R&D in emerging and mature technologies should not be subsidized equally. The reason is that R&D in the two technologies is not equally undersupplied in the market due to differences in their knowledge stocks. R&D in the mature technology should be subsidized more when the sum of the output elasticities with respect to labor and knowledge in R&D production is high, while R&D in the emerging technology should be subsidized more when the elasticities are low.
Subjects: 
Endogenous growth
Innovation policy
Technological spillovers
Sector-specific R&D.
JEL: 
O32
O38
Document Type: 
Working Paper

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