Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/93964
Authors: 
Giebe, Thomas
Grebe, Tim
Wolfstetter, Elmar G.
Year of Publication: 
2005
Series/Report no.: 
SFB/TR 15 Discussion Paper 108
Abstract: 
This paper evaluates how R&D subsidies to the business sector are typically awarded. We identify two sources of ine_ciency: the selection based on a ranking of individual projects, rather than complete allocations, and the failure to induce competition among applicants in order to extract and use information about the necessary funding. In order to correct these ine_- ciencies we propose mechanisms that include some form of an auction in which applicants bid for subsidies. Our proposals are tested in a simulation and in controlled lab experiments. The results suggest that adopting our proposals may considerably improve the allocation.
Subjects: 
Research
Subsidies
Experimental Economics
JEL: 
D44
D45
H25
O32
O38
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

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