Cardiff University | Prifysgol Caerdydd ORCA
Online Research @ Cardiff 
WelshClear Cookie - decide language by browser settings

State aid to investment and R&D

Collie, David Robert 2005. State aid to investment and R&D. Economic Papers, vol. 231. European Commission. Available at: http://ec.europa.eu/economy_finance/publications/p...

Full text not available from this repository.

Abstract

The prohibition of state aid to Investment and R&D in an integrated market such as the European Community is analysed in a Cournot oligopoly model where firms undertake investment or R&D to reduce their costs. Both strategic and non-strategic investment and R&D are considered. Governments in the member states give subsidies for investment and R&D, which are financed by distortionary taxation so the opportunity cost of government revenue exceeds unity. Prohibiting state aid to investment will always increase aggregate welfare. Prohibiting state aid to R&D will always increase aggregate welfare if spillovers from R&D are small. If spillovers from R&D are moderate then there exists a range of values for opportunity cost where governments give state aid and where the prohibition of state aid will increase aggregate welfare. Prohibiting state aid to R&D will reduce aggregate welfare if spillovers from R&D are large.

Item Type: Monograph (Other)
Date Type: Publication
Status: Published
Schools: Business (Including Economics)
Subjects: J Political Science > JA Political science (General)
J Political Science > JF Political institutions (General)
Publisher: European Commission
Last Modified: 04 Jun 2017 05:12
URI: http://orca.cf.ac.uk/id/eprint/49660

Actions (repository staff only)

Edit Item Edit Item