The additionality of R&D tax policy: Quasi-experimental evidence

Jared Holt; Ahmed Skali; Russell Thomson

doi:10.1016/j.technovation.2021.102293

The additionality of R&D tax policy: Quasi-experimental evidence

Jared Holt, Ahmed Skali^*, Russell Thomson

^*Corresponding author for this work

Research output: Contribution to journal › Article › Academic › peer-review

12 Citations (Scopus)

104 Downloads (Pure)

Abstract

Despite the prevalence of R&D tax incentives, the amount of additional investment induced by each dollar of tax revenue forgone remains contested. It is notoriously difficult to identify the impact of R&D tax incentives because all firms are potentially eligible and because benefit and investment are jointly determined. Using comprehensive, firm-level data, we apply difference-in-difference analysis around a significant policy reform in Australia in 2012. We find that firms invest an additional $1.90 for every dollar of tax revenue forgone.

Original language	English
Article number	102293
Number of pages	6
Journal	Technovation
Volume	107
Early online date	23-May-2021
DOIs	https://doi.org/10.1016/j.technovation.2021.102293
Publication status	Published - Sept-2021

Keywords

Difference-in-Differences
Firm-level
Innovation
R&D tax policy

Access to Document

10.1016/j.technovation.2021.102293Licence: CC BY

The additionality of R&D tax policy: Quasi-experimental evidenceFinal publisher's version, 440 KBLicence: CC BY

Handle.net

Persistent link

Cite this

@article{07cefce9858e49da9558028607b18a67,

title = "The additionality of R&D tax policy: Quasi-experimental evidence",

abstract = "Despite the prevalence of R&D tax incentives, the amount of additional investment induced by each dollar of tax revenue forgone remains contested. It is notoriously difficult to identify the impact of R&D tax incentives because all firms are potentially eligible and because benefit and investment are jointly determined. Using comprehensive, firm-level data, we apply difference-in-difference analysis around a significant policy reform in Australia in 2012. We find that firms invest an additional $1.90 for every dollar of tax revenue forgone.",

keywords = "Difference-in-Differences, Firm-level, Innovation, R&D tax policy",

author = "Jared Holt and Ahmed Skali and Russell Thomson",

year = "2021",

month = sep,

doi = "10.1016/j.technovation.2021.102293",

language = "English",

volume = "107",

journal = "Technovation",

issn = "0166-4972",

publisher = "ELSEVIER SCIENCE BV",

}

TY - JOUR

T1 - The additionality of R&D tax policy: Quasi-experimental evidence

AU - Holt, Jared

AU - Skali, Ahmed

AU - Thomson, Russell

PY - 2021/9

Y1 - 2021/9

N2 - Despite the prevalence of R&D tax incentives, the amount of additional investment induced by each dollar of tax revenue forgone remains contested. It is notoriously difficult to identify the impact of R&D tax incentives because all firms are potentially eligible and because benefit and investment are jointly determined. Using comprehensive, firm-level data, we apply difference-in-difference analysis around a significant policy reform in Australia in 2012. We find that firms invest an additional $1.90 for every dollar of tax revenue forgone.

AB - Despite the prevalence of R&D tax incentives, the amount of additional investment induced by each dollar of tax revenue forgone remains contested. It is notoriously difficult to identify the impact of R&D tax incentives because all firms are potentially eligible and because benefit and investment are jointly determined. Using comprehensive, firm-level data, we apply difference-in-difference analysis around a significant policy reform in Australia in 2012. We find that firms invest an additional $1.90 for every dollar of tax revenue forgone.

KW - Difference-in-Differences

KW - Firm-level

KW - Innovation

KW - R&D tax policy

UR - https://www.mendeley.com/catalogue/3cdd83e9-5fc2-3608-a316-287766a09a29/

U2 - 10.1016/j.technovation.2021.102293

DO - 10.1016/j.technovation.2021.102293

M3 - Article

SN - 0166-4972

VL - 107

JO - Technovation

JF - Technovation

M1 - 102293

ER -

The additionality of R&D tax policy: Quasi-experimental evidence

Abstract

Keywords

Access to Document

Handle.net

Other files and links

Fingerprint

Cite this