The Impact of Corporate Taxes on Firm Innovation: Evidence from the Corporate Tax Collection Reform in China

Abstract

The views expressed herein are those of the authors and do not necessarily reflect the views of the National Bureau of Economic Research. NBER working papers are circulated for discussion and comment purposes. They have not been peerreviewed or been subject to the review by the NBER Board of Directors that accompanies official NBER publications.

The effects of R&D tax incentives and their role in the innovation policy mix

“…42 In other words, the interval 0.83-1.15 covers the "true" incrementality ratio with a probability 90%. 43 The semi-elasiticities estimated here for business R&D investments are of a similar degree of magnitude as those estimated for patenting (see, e.g., Griffith et al, 2014;Akcigit et al 2018;Alstaedter et al, 2018;Cai et al 2018;and Akcigit and Stantcheva, 2020). 44 Both intramural and extramural R&D expenditure can be affected by tax incentives, so it is desirable to analyse the impact of the tax incentives on both types of R&D expenditure.…”

Notching R&D Investment with Corporate Income Tax Cuts in China

“…Our results show that the seemingly low return to reported R&D is an artifact of relabeling (König et al, 2018). Finally, tax incentives for R&D may be particularly costly in emerging economies where the corporate tax is imperfectly enforced (Cai et al, 2018).…”

Does Higher Education Promote Firm Innovation in China?

“…The data used in this study include only published patents and do not include patents that had not been published after application. The Chinese Patent Census Database we used was unique, as it is the first to include indicators of innovation quality, such as patent citations and patent claims, which were not included in the versions of the Chinese Patent Census Database used in other studies [34][35][36].…”

“…The first was innovation quantity (IN_qn), defined as the total number of patents of a firm in a certain year. The number of patents of a firm has frequently been used to measure the level of innovation of a firm [34][35][36]. However, quality varies among patents, which must also be taken into account if we are to measure innovation in a more proper way [37,38].…”