QUEEN’S BUSINESS SCHOOL INTERNATIONAL BUSINESS, ENTREPRENEURSHIP & MARKETING (IBEM) SEMINAR SERIES

Wednesday 4^th February

2pm

“To repeat or not to repeat R&D grants to firms: That is the question”

Kevin mulligan

QUB/QBS

Abstract

The phenomenon of repeated R&D grants refers to situations where firms receive multiple R&D grants over a short period of time. While repeated R&D grants are common in many economies, our understanding of how they influence firm-level R&D and firm performance outcomes remains limited. This is a critical gap in existing knowledge. On the one hand, there is a danger that repeat recipients become so-called ‘grant-repreneurs’. Such firms are experts at winning scarce public R&D funding, with limited additional focus on the commercialisation activity required to justify repeated support. This comes at the expense of other firms who are not R&D grant application experts. On the other hand, repeated R&D grants may be necessary to assist firms who have an abundance of high-potential ideas, requiring sustained support over time. This study addresses this gap by constructing novel datasets for firms in Germany and Ireland, providing evidence for both a large country and a small open economy. Our analysis combines matching with staggered difference-in-differences, ensuring a fair comparison of like-with-like, while accounting for firm-level and time-specific heterogeneous effects. Our findings suggest that repeated R&D grants can be highly effective. They tend to result in greater firm-level R&D and performance outcomes, relative to single or ‘one-off’ R&D grants. Moreover, our results suggest that the additional impacts of repeated R&D grants are not driven by simply providing more money to firms. Rather, continuous support over time appears to be key. These insights advance our understanding of repeated R&D grants, suggesting important policy implications.

QBS Student Hub, Entrepreneurial Hub, 01.028