Matthew effects and RandD subsidies: knowledge cumulability in high-tech and low-tech industries

The paper explores the causes and effects of persistence in the discretionary allocation of public subsidies to RandD activities performed by private firms in high-tech and low-tech industries. It applies the distinction between vicious Matthew-effect and virtuous Matthew-effect. The former qualifie...

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Bibliographic Details
Published in:	Giornale degli economisti e annali di economia Vol. 71; no. 1
Main Authors:	Antonelli, C, Crespi, F
Format:	Journal Article
Language:	English
Published:	01-10-2012
Subjects:	Government grant High technology Industry Investment funds Research and development Subsidies
Online Access:	Get full text
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Summary:	The paper explores the causes and effects of persistence in the discretionary allocation of public subsidies to RandD activities performed by private firms in high-tech and low-tech industries. It applies the distinction between vicious Matthew-effect and virtuous Matthew-effect. The former qualifies the persistence in the discretionary allocation of public subsidies in terms of sheer reputation based upon previous awards. The latter is identified by the role of the accumulation of competence stemming from past grants in current RandD activities. Virtuous Matthew effects are found in high-tech industries where knowledge cumulability is higher. In traditional industries, vicious Matthew effects prevail for the lower levels of knowledge cumulability. Here reputation-Matthew-effects can lead to substitution of private funds with public ones.
Bibliography:	ObjectType-Article-2 SourceType-Scholarly Journals-1 content type line 23 ObjectType-Feature-1
ISSN:	0017-0097