Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/32623
Authors: 
Cantner, Uwe
Kösters, Sarah
Year of Publication: 
2009
Series/Report no.: 
Jena economic research papers 2009,093
Abstract: 
This paper investigates the allocation of R&D subsidies given to start-ups. Considering the coexistence of various R&D project schemes, we take an aggregate view and analyze the determinants of the receipt of (any) R&D subsidies within the first three business years of the start-ups. We argue that policymakers and funding authorities follow a strategy of picking the winner. Analyzing a unique data set of start-ups in the East German state of Thuringia, we conduct logistic regressions and find ambiguous support. R&D subsidies are given to start-ups with innovative business ideas, especially academic spin-offs. On the other hand, the ambitions and the patent stock of the founder(s) do not decide the receipt of R&D subsidies. These insights into the overall allocation of R&D subsidies are important since they have implications for policy effectiveness and efficiency. The implied difficulties of policy targeting fundamentally question the massive subsidization of private R&D.
Subjects: 
Start-ups
R&D subsidies
Subsidy allocation
JEL: 
O38
L26
L52
Document Type: 
Working Paper

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