Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/237389 
Year of Publication: 
2020
Series/Report no.: 
ETLA Report No. 99
Publisher: 
The Research Institute of the Finnish Economy (ETLA), Helsinki
Abstract: 
We review the extant research on the government innovation promotion rationales and impacts. Based on the research literature, the review synthesizes innovation promotion rationales, economic justifications for the intervention, impact evaluations of innovation promotion interventions, and current forms and mechanisms of innovation promotion. We identify four main rationales and economic justifications for government intervention in promoting research, technology development, and innovation: (1) the market failure rationale; (2) the system failure rationale; (3) policy outcome rationale from positive spill-over effects from research, technology development and innovation; and (4) four mission oriented policy rationale, including grand societal challenges, responsible innovation, demand-side innovation policy, and public sector innovation. Recent impact evaluation evidence show, in general, more positive than negative outcomes from innovation promotion. Research designs still include high degree of heterogeneity, and thus has some mixed results. Studies are still divided on the crowding-out effect, and to which extent interventions translate into long-lasting benefits. We find tentative positive impacts on broader policy goals seeking for societal and economic benefits. Future public policies and impact evaluations should seek to incorporate more holistic and longitudinal designs.
Subjects: 
Innovation policy
Impact evaluation
Policy rationales
Innovation promotion
JEL: 
L53
O38
O30
Document Type: 
Research Report

Files in This Item:
File
Size





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.