Impact of Research Tax Credit on R&amp;D and Innovation: Evidence from the 2008 French Reform

Bozio, Antoine; Irac, Delphine; Py, Loriane

doi:10.2139/ssrn.2544604

Cited by 37 publications

(25 citation statements)

References 26 publications

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“…Comparable results were found by other authors who conducted similar empirical analyses employing data on different countries and years of observation, such as Klassen et al (2004), Haegeland and Moen (2007), Lee (2011), Yang et al (2012, Kasahara et al (2014), Bozio et al (2014), and Kobayashi (2014). In addition, the effects found in the earlier and more recent studies are of around the same magnitude.…”

Section: Evaluation Of a Treatment Effectsupporting

confidence: 73%

“…However, many of the earlier studies in this area disregard the problem of a selection bias, according to which the recipients of R&D tax credits or super-deductions might systematically differ from the non-recipients. For this reason, recent studies such as Yang et al (2012), Bozio et al (2014), Kobayashi (2014), Guceri (2017) have estimated the effect of R&D tax incentives after meticulously correcting a possible selection bias using the propensity score matching (PSM) technique. This strategy helps to identify comparable companies and to classify and divide them into treatment and control groups.…”

Section: Evaluation Of a Treatment Effectmentioning

confidence: 99%

“…These authors conclude that input-oriented fiscal incentives for R&D effectively foster research and development. Yang et al (2012), Bozio et al (2014), Kobayashi (2014, and Guceri (2017) Numerous empirical and theoretical studies investigate the use of intangible assets in profit shifting. These studies argue that multinational enterprises strategically allocate intangible assets at low-tax subsidiaries in order to shift profits via royalty payments from high-tax to lowtax group members.…”

Section: Literature Reviewmentioning

confidence: 99%

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Tax Incentives for Research and Development and Their Use in Tax Planning

Pfeiffer

Spengel

2017

SSRN Journal

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Die Dis cus si on Pape rs die nen einer mög lichst schnel len Ver brei tung von neue ren For schungs arbei ten des ZEW. Die Bei trä ge lie gen in allei ni ger Ver ant wor tung der Auto ren und stel len nicht not wen di ger wei se die Mei nung des ZEW dar.Dis cus si on Papers are inten ded to make results of ZEW research prompt ly avai la ble to other eco no mists in order to encou ra ge dis cus si on and sug gesti ons for revi si ons. The aut hors are sole ly respon si ble for the con tents which do not neces sa ri ly repre sent the opi ni on of the ZEW. This study provides a comprehensive analysis of various aspects of R&D tax incentives. It explains the economic justification behind the state support of research and development and summarizes its main types. In addition, it gives an overview of the existing R&D tax incentives in Europe and provides a thorough review of the empirical literature on the outcomes of fiscal incentives. Furthermore, the Devereux and Griffith model is used to determine the effective tax burden of multinational firms that reside in countries which implement R&D tax support and countries which do not. The model is developed further following Spengel and Elschner (2010) and Evers et al. (2015) to reflect a potential use of R&D tax incentives by multinational firms for tax planning. The hypothesis developed in the model is tested in an empirical estimation, where we employ the OECD data on international co-operation in patents. According to our main findings, there are at least two reasons why input-oriented R&D tax incentives, such as tax credits and tax super-deductions, constitute a more suitable instrument for fostering research and development than the output-oriented incentives, such as IP Boxes. First, there is robust evidence found in the empirical literature which shows the positive effect introducing inputoriented tax incentives has on a firm's innovative activity, whereas studies on output-oriented tax incentives are not able to support this argument. Secondly, according to our theoretical and empirical analyses, output-oriented R&D tax incentives may be used by multinationals for tax planning as opposed to their intended use of fostering research and development. Tax Incentives for Research and Development and Their Use in Tax PlanningOlenaKeywords: research and development; R&D; tax planning; corporate taxation IntroductionState support of research and development (R&D) is not only economically justified in numerous theoretical and empirical studies but is also enforced in many countries around the world. Fiscal incentives constitute one of the key instruments of state support of R&D, as they are easier to implement and are less complex to monitor than, for example, direct R&D grants or subsidies. There are various types of fiscal incentives for research and development, some of which focus on supporting the development or input phase of a research process, whereas others concentrate on the income-generating output phase. The first group of R&D tax incentives includes tax c...

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Section: Evaluation Of a Treatment Effectsupporting

confidence: 73%

Section: Evaluation Of a Treatment Effectmentioning

confidence: 99%

Section: Literature Reviewmentioning

confidence: 99%

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Tax Incentives for Research and Development and Their Use in Tax Planning

Pfeiffer

Spengel

2017

SSRN Journal

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“…First, the estimates combine the intensive margin (increase in R&D intensity for R&D performing firms) and the extensive margin (increase in the number of R&D performing firms). On the extensive margin more firms have decided to start doing R&D especially in the year of the 2008 reform of the R&D tax credit (Bozio et al, 2014). To enter the R&D game firms need to incur sunk costs in addition to the fixed and variable costs of R&D. Arqué-Castells and Mohnen (2015) estimate these sunk costs to be as large as 1% of total sales and to be higher for small firms than for large firms.…”

Section: Discussion Of the Resultsmentioning

confidence: 99%

Comment: Effectiveness of public support for R&D and entrepreneurship

Mohnen¹

2017

Ecostat

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The papers by Dortet-Bernadet and Sicsic and by Redor in this issue examine respectively the success of R&D financial support programs in stimulating private R&D and the success of subsidized start-ups for the unemployed in creating long-lasting firms. Both papers focus on small French firms. Both programs are found to suffer from a deadweight loss. This comment discusses the results obtained and the policy conclusions that can be drawn from them. It is argued that the deadweight loss is in part unavoidable but that there are ways to limit it, for instance by using a policy mix of R&D tax incentives and subsidies, favoring tax incentives for small firms and subsidies for large firms. It is also recalled that a policy ought to be evaluated from various perspectives. Besides R&D additionality and firm survival a full cost benefit analysis would also consider R&D externalities, firm retention and decrease in unemployment. JEL codes: O31, J68

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“…Wariantem tym posługiwano się np. we Francji w latach 1983-2004[Bonzio, Irac, Py, 2014. Nierzadko można również spotkać formułę mieszaną opartą na połączeniu dwóch wcześniejszych konstrukcji.…”

Section: Rodzaj Oddziaływania Efekt Substytucji Efekt Wypychania Efekunclassified

Ulga na B+R – ocena zmian w zakresie podatkowego wsparcia działalności innowacyjnej w Polsce

Zegarowicz

2016

Optimum

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StreszczenieCel -celem niniejszego opracowania jest ukazanie podatkowych instrumentów wsparcia jako istotnego elementu polityki innowacyjnej państwa oraz analiza zmian w poziomie pośredniego wsparcia działalności innowacyjnej, jakie zaszły w polskim systemie podatkowym w wyniku zastąpienia ulgi na nowe technologie ulgą na badania i rozwój. Metodologia badania -została przeprowadzona symulacja możliwości zmniejszenia kosztów działalności innowacyjnej dostępnych dla typowego przedsiębiorstwa w przypadku ulgi na nowe technologie oraz ulgi na badania i rozwój. Jako materiał źródłowy posłużyły dane statystyczne pochodzące z Głównego Urzędu Statystycznego oraz przepisy prawne dotyczące obu instrumentów wsparcia. Wynik -dzięki analizie literatury uzasadniono istotność stosowania podatkowych instrumentów wsparcia w ramach polityki innowacyjnej. Na podstawie analizy danych i przedstawionych rozważań należy stwierdzić, że ulga na badania i rozwój charakteryzuje się wyższym poziomem pośredniej partycypacji państwa w ogólnych kosztach działalności innowacyjnej przedsiębiorstw niż ulga na nowe technologie. Oryginalność/wartość -z racji narastającej roli innowacyjności w kształtowaniu wzrostu i rozwoju gospodarczego, wsparcie sektora prywatnego w kreowaniu innowacji staje się jednym z ważniejszych elementów polityki gospodarczej. Zasadnicza jest zatem analiza i ocena funkcjonujących instrumentów wsparcia i zmian, jakie zachodzą w tym zakresie. Z uwagi na liczne zastrzeżenia do istniejącego systemu wsparcia działalności innowacyjnej w Polsce, a także dynamiczne zmiany w tym zakresie, w artykule podjęto bardzo aktualny temat. Słowa kluczowe: innowacja, innowacyjność, polityka innowacyjna, podatkowe instrumenty wsparcia, taxexpenditures R&D RELIEF: ASSESSMENT OF CHANGES IN TAX SUPPORT FOR INNOVATION ACTIVITY IN POLAND SummaryThe purpose of the paper is to show tax support instruments as a significant element of the innovation policy of the country and to analyze changes at the level of indirect support for innovation activity that took place in the Polish tax system as a result of replacing the relief on new technologies with a relief on research and development. The research methodology involves a simulation of capabilities to reduce the costs of innovation activity available to a typical enterprise in the case of the relief on new technologies and the new relief on research and development. Statistical data from the Central Statistical Office and legal provisions relating to both instruments of support serve as a source material. Based on the analysis of the literature, the significance of using tax instruments as part of innovation policy is justified. On the basis of data analysis, it

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Impact of Research Tax Credit on R&D and Innovation: Evidence from the 2008 French Reform

Cited by 37 publications

References 26 publications

Tax Incentives for Research and Development and Their Use in Tax Planning

Tax Incentives for Research and Development and Their Use in Tax Planning

Comment: Effectiveness of public support for R&D and entrepreneurship

Ulga na B+R – ocena zmian w zakresie podatkowego wsparcia działalności innowacyjnej w Polsce

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