Publication Type
Journal Article
Version
submittedVersion
Publication Date
1-2023
Abstract
This paper investigates the extent to which a regulatory environment for R&D subsidies shapes the magnitude and direction of R&D subsidies set by a government and consequent innovation paths. When the WTO adopted a permissive regulatory environment, we find that the Korean government increased R&D subsidies significantly (89.21%) and selectively so for firms and industries with higher returns. Recipient firms conducted less basic research and more development research. Improvements in innovations were mostly incremental and minor. However, such changes did not persist once the WTO switched to a restrictive regulatory environment. Our findings show that the regulatory environment imposed by the WTO largely affects allocation of R&D subsidies and suggest that a permissive regulatory environment may not necessarily maximize the potential for breakthrough innovations.
Keywords
Innovations, Patent, R&D subsidy, Regulatory environment, Utility model, WTO subsidy rules
Discipline
Asian Studies | Industrial Organization | Technology and Innovation
Research Areas
Applied Microeconomics
Publication
Research Policy
Volume
52
Issue
1
First Page
1
Last Page
14
ISSN
0048-7333
Identifier
10.1016/j.respol.2022.104620
Publisher
Elsevier
Citation
KOH, Yumi and LEE, Gea M..
R&D subsidies in permissive and restrictive environment: Evidence from Korea. (2023). Research Policy. 52, (1), 1-14.
Available at: https://ink.library.smu.edu.sg/soe_research/2629
Copyright Owner and License
Authors
Creative Commons License
This work is licensed under a Creative Commons Attribution-NonCommercial-No Derivative Works 4.0 International License.
Additional URL
https://doi.org/10.1016/j.respol.2022.104620
Included in
Asian Studies Commons, Industrial Organization Commons, Technology and Innovation Commons