Direct R&D subsidies lead to triple the patents compared to tax credits
The study looked at how government support for research and development (R&D) in Norway affects firms' ability to patent new inventions. They found that both direct subsidies and tax credits from the government led to more patents being granted to firms. However, the impact of these supports depended on the firms' characteristics before receiving the help. Firms that had not applied for patents before getting support saw the most significant increase in patents. Direct subsidies were more effective than tax credits in generating patents. The study suggests that R&D support should focus on helping firms with high potential for innovation, rather than those that are already innovative. Prioritizing certain areas for subsidies could lead to more innovations benefiting society.