Are R&D Subsidies Provided Optimally? Evidence from a Simulated Agency-Firm Stochastic Dynamic Game (Articolo in rivista)

Type
Label
  • Are R&D Subsidies Provided Optimally? Evidence from a Simulated Agency-Firm Stochastic Dynamic Game (Articolo in rivista) (literal)
Anno
  • 2012-01-01T00:00:00+01:00 (literal)
Alternative label
  • Cerulli, Giovanni (2012)
    Are R&D Subsidies Provided Optimally? Evidence from a Simulated Agency-Firm Stochastic Dynamic Game
    in JASSS (Guildf.)
    (literal)
Http://www.cnr.it/ontology/cnr/pubblicazioni.owl#autori
  • Cerulli, Giovanni (literal)
Http://www.cnr.it/ontology/cnr/pubblicazioni.owl#numeroVolume
  • 15 (literal)
Rivista
Http://www.cnr.it/ontology/cnr/pubblicazioni.owl#pagineTotali
  • 14 (literal)
Http://www.cnr.it/ontology/cnr/pubblicazioni.owl#numeroFascicolo
  • 1 (literal)
Note
  • ISI Web of Science (WOS) (literal)
Http://www.cnr.it/ontology/cnr/pubblicazioni.owl#affiliazioni
  • CNR Ceris (literal)
Titolo
  • Are R&D Subsidies Provided Optimally? Evidence from a Simulated Agency-Firm Stochastic Dynamic Game (literal)
Abstract
  • By means of a simulated funding-agency/supported-firm stochastic dynamic game, this paper shows that the level of the subsidy provided by a funding (public) agency, normally used to correct for firm R&D shortage, might be severely underprovided. This is due to the \"externalities\" generated by the agency-firm strategic relationship, as showed by comparing two versions of the model: one assuming \"rival\" behaviors between companies and agency (i.e., the current setting), and one associated to the \"cooperative\" strategy (i.e. the optimal Pareto-efficient benchmark). The paper looks also at what \"welfare\" implications are associated to different degrees of persistency in the funding effect on corporate R&D. Three main conclusions are thus drawn: (i) the relative quota of the subsidy to R&D is undersized in the rival compared to the cooperative model; (ii) the rivalry strategy generates distortions that favor the agency compared to firms; (iii) when passing from less persistent to more persistent R&D additionality/crowding-out effect, the lower the distortion the greater the variance is and vice versa. As for the management of R&D funding policies, we suggest that all the elements favouring greater collaboration between agency and firm objectives may help current R&D support to approach its social optimum. (literal)
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