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http://dx.doi.org/10.22156/CS4SMB.2020.10.01.001

The Impact of Innovation Policy Mix on SME R&D Investment: Focusing on Financial Instruments  

Kim, Kiman (Division of Policy Research, Green Technology Center)
Lee, Sooyeon (Center for Educational Research and Innovation, Duksung Women's University)
Publication Information
Journal of Convergence for Information Technology / v.10, no.1, 2020 , pp. 1-12 More about this Journal
Abstract
The Government provides a financial assistance to stimulate firm R&D and innovation activities. Previous papers on the impact of public subsidies on firm R&D investments mainly had a focus on an individual policy tool regardless of potential impacts of other policy instruments. This study addresses this gap by examining the effects of policy mix regarding a subsidy and a tax credit. The empirical analyses from fixed effect model using Survey on Technology of SMEs 2015-2017 revealed valuable points. First, policy mix induces more R&D investment of SMEs, which in turn, shows a complementary relationship between two instruments. Second, even if impact of tax credit controlled, subsidy is positively associated with SMEs R&D investment. These findings justify policy mix interventions to promote SME R&D activity. Moreover, grants can be applied as a more useful policy tool for SMEs that are constrained by resources and capabilities.
Keywords
Innovation Policy; Additionality; Policy mix; SME R&D investment; Public subsidies;
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Times Cited By KSCI : 4  (Citation Analysis)
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