The Evaluation of the Efficacy of the R&D European Funds in Piedmont

This paper provides some empirical evidence of the impact of two policy measures, aiming at supporting innovative activity of small and medium firms in Piedmont. Both measures use European Structural Funds, but are managed at a regional level. Measure 2.1b, a concessional loan aiming at stimulating the introduction of innovative plants, machinery and equipments, had positive effects on investments, assets and sales in the short run; but there are hints that investments could have been anticipated from already scheduled projects in the following periods. Measure 2.6b, a free grant aiming at stimulating research activity of firms, had positive effects on intangible investments and capital, but this new knowledge does not seem to be able to directly impact on the production process of the firm. When evaluating the effect for specific groups of firms, for both measures we do not find stronger effects for firms characterized by a high intensity of subsidy. When considering firms with a high cost of capital, we find that Measure 2.1b significantly reduced the interest rate asked by the lenders also after the end of the project, while Measure 2.6b had not been effective at all.

Innovation activity, R&D incentives, competition and market value.

This thesis examines some characteristics of the interaction between innovation activity of firms, in particular R&D, and economic system. The first main chapter analyses a mechanism of interaction between R&D and market structure, in a horizontally differentiated market where firms invest to increase differentiation among varieties. R&D activity declines over time; prices, output and short-run profits of firms producing the differentiated product move towards the higher steadystate values, production of the non-differentiated good falls. The increasing specialization improves the overall utility of consumers. The comparison with the socially optimal solution shows that firms underinvest in R&D. The second main chapter evaluates the effectiveness of the incentives to development of innovations provided by the Italian Ministry for Economic Development through the Fund for Technological Innovation. We analyse the subsidies to firms supplied by the general and the special sections of this Fund, using a difference-in-differences framework and a regression discontinuity one. We find no hints of effect on investments, dimension, labour productivity, labour costs, financial structure and profitability. For the general section, the effect on assets is positive, suggesting that firms used the subsidy to finance current expenditures. The third main chapter examines the relationship between R&D and market value of firms. We find high heterogeneity in the coefficients of different US manufacturing sectors between 1975 and 1995; sometimes the effects of current R&D on market value are very small or negative. We develop a model with uncertain R&D, where we decompose market value in two components, due to the already concretized assets and to work-in-progress R&D. Risk aversion may cause different evaluations of these components: when investors are risk-averse and managers maximize the long-run firm value, the risk associated with work-in-progress R&D reduces the short-run firm value even if its expected long-run value grows

Evaluating the impact of innovation incentives: evidence from an unexpected shortage of funds

To evaluate the effect of an R&D subsidy one needs to know what the subsidized firms would have done without the incentive. This paper studies an Italian programme of subsidies for the applied development of innovations, exploiting a discontinuity in programme financing due to an unexpected shortage of public money. To identify the effect of the programme, the study implements a regression discontinuity design and compares firms that applied for funding before and after the shortage occurred. The results indicate that the programme was not effective in stimulating innovative investment.R&D, public policy, evaluation

Acquisition and tracking of Galileo IOV E5 signals: experimental results and performance evaluation

An assessment of the Galileo In-Orbit Validation (IOV) signals on the E5 band is presented in this paper, investigating the signal features compared with the expected characteristics as described in the Galileo Interface Control Document (ICD) specifications. In detail, the results in terms of signal acquisition and tracking during multiple satellite passes are discussed, providing also a description of the experimental setup used in order to separately receive and process E5a and E5b signals. The analysis covers the received signal strength versus the satellite elevation, the modulation format, and the presence of navigation data and secondary code chips. Since at time of writing both the two Galileo IOV satellites (PFM and FM2) are broadcasting E5 signals, the results obtained processing their E5a and E5b signals are discussed. In addition, these signals are also compared with those currently transmitted by the two experimental Galileo satellites, GIOVE-A and GIOVE-

Evaluating the Impact of Innovation Incentives: Evidence from an Unexpected Shortage of Funds, Temi di discussione no. 792

Abstract To evaluate the effect of an R&D subsidy one needs to know what the subsidized firms would have done without the incentive. This paper studies an Italian programme of subsidies for the applied development of innovations, exploiting a discontinuity in programme financing due to an unexpected shortage of public money. To identify the effect of the programme, the study implements a regression discontinuity design and compares firms that applied before and after the shortage occurred. The results indicate that the programme was not effective in stimulating innovative investment

Evaluating the Impact of Innovation Incentives: Evidence from an Unexpected Shortage of Funds, Temi di discussione no. 792

Abstract To evaluate the effect of an R&D subsidy one needs to know what the subsidized firms would have done without the incentive. This paper studies an Italian program of subsidies to stimulate the applied development of innovations. It exploits a discontinuity in program financing due to an unexpected shortage of public money. To identify the effect of the program the study implements a regression discontinuity design and compares firms that applied before and after the shortage took place. Results indicate that the program was not effective in stimulating innovative investments

Contact! - First acquisition and tracking of IOV Galileo signals

Europe's GNSS program -Galileo - entered a new phase of development with the recent launch of two in-orbit validation satellites, which comprise the first elements of the system's full operational constellation. In this article, a team of italian researchers present the initial results of their analysis of the Galileo signal