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Regular version of the site

Article

Assessing the impact of public funding and tax incentives in Russia: Recipient analysis and additionality effects evaluation

Simachev Y. V., Zudin N., Kuzyk M.

So far a considerable number of studies have used the concept of additionality as basic evaluation approach but none of them paid attention to additionality effects of the Russian innovation policy yet. In this study we performed a microeconomic evaluation of the industrial firms’ public innovation support in Russia focusing on its two key toolbox elements: direct funding and tax incentives. Based on the data from a questionnaire survey of top executives of Russian manufacturing firms from 2015 we identified and evaluated the profiles and the performance of recipients of direct funding and tax incentives. We also assessed the ”relative” additionality - the additionality of a concrete instrument for a particular firm relative to all other used instruments - with propensity score matching. The results show that generally Russian industrial innovation policy tends to target sufficiently large and long-operating companies. In terms of effects we have confirmed not only the importance of the fiscal support in providing main aspects of additionality but also its significance in crowding-out private investment. Our results suggest tax incentives do hardly contribute to additionality of any kind which is especially unusual regarding input additionality. One should also point out a relatively small impact of public support on science-business cooperation which is quite unexpected in view of the substantial effort provided by the Russian government in enhancing its development.