Additionality of Public R&D Grants in a Transition Economy

This paper estimates the impact of public R&D grants on firms R&D and innovation input. Its results point towards a large degree of additionality in public R&D grants with regard to innovation input measured as R&D expenditures and innovation expenditures, as well as with regard to innovation output measured by patent applications. The authors suggest that a regional redistribution of public R&D subsidies might improve the overall innovation output of the German economy.