Evaluating the Impact of Technology Development Funds in Emerging Economies: Evidence from Latin-America

Evaluations of government Technology Development Funds (TDFs) in Argentina, Brazil, Chile and Panama are surveyed. All the evaluations were done at the recipient (firm) level using data from innovation surveys, industrial surveys, and administrative records of the granting units, together with quasi-experimental econometric techniques to minimize the effects of any selection bias. TDF effectiveness is found to depend on the financing mechanism used, on the presence of non-financial constraints, on firm-university interaction, and on the characteristics of the target beneficiaries. Four levels of potential impact were considered: R&D input additionality, behavioural additionality, increases in innovative output, and improvements in performance. The evidence suggests that TDF do not crowd out private investment and that they positively affect R&D intensity. In addition, participation in TDF induces a more proactive attitude of beneficiary firms towards innovation activities. However, the analysis does not find much statistically significant impact on patents or new product sales and the evidence on firm performance is mixed, with positive results in terms of firm growth, but little corresponding positive impact on measures of firm productivity, possibly because the horizon over which the evaluation was conducted was too short.Innovation and R&D, Policy Evaluation

SME Policy and Firms’ Productivity in Latin America

Very little is known about the effectiveness of SME policies, and a careful look at the structure, mechanisms and incentives provided by these policies suggest caution in their implementation and, most importantly, the need to carefully and closely monitor their results. This paper relies on the microeconometric analysis of a homogeneous dataset of sixteen Latin American and Caribbean countries to analyze the magnitude and determinants of the productivity gap between large and SME firms and to simulate of the impact on productivity of various policy scenarios.SMEs, SME policy, productivity, Latin America

Evaluating the Impact of Technology Development Funds in Emerging Economies: Evidence from Latin America

Evaluations of government Technology Development Funds (TDF) in Argentina, Brazil, Chile and Panama are surveyed. All the evaluations were done at the recipient (firm) level using data from innovation surveys, industrial surveys, and administrative records of the granting units, together with quasi-experimental econometric techniques to minimize the effects of any selection bias. TDF effectiveness is found to depend on the financing mechanism used, on the presence of non-financial constraints, on firm-university interaction, and on the characteristics of the target beneficiaries. Four levels of potential impact were considered: R&D input additionality, behavioural additionality, increases in innovative output, and improvements in performance. The evidence suggests that TDF do not crowd out private investment and that they positively affect R&D intensity. In addition, participation in TDF induces a more proactive attitude of beneficiary firms towards innovation activities. However, the analysis does not find much statistically significant impact on patents or new product sales and the evidence on firm performance is mixed, with positive results in terms of firm growth, but little corresponding positive impact on measures of firm productivity, possibly because the horizon over which the evaluation was conducted was too short.

The Impact of Public Credit Programs on Brazilian Firms

This paper analyzes the effectiveness of public credit lines in promoting the performances of Brazilian firms. We focus on the impact of the credit lines managed by BNDES and FINEP in fostering growth measured in terms of employment, labor productivity and export. For this purpose, we use a unique panel data set developed by the Instituto de Pesquisa Econômica Aplicada (IPEA), which includes information on both firm-level performances and access to public credit lines. This particular data setting allows us to use quasi-experimental techniques to control for selection bias when estimating the impact of the public credit lines. The core of our estimation strategy is based on a difference-in-differences technique, which we complement with matching methods for robustness check. Our results consistently show that access to public credit lines has a significant and robust positive impact on employment growth and exports, while we do not find evidence of a significant effect on our measure of productivity. Interestingly enough, our findings show that impact on exports is driven by the increase in export volumes among exporting firms, while no significant effect on the probability of becoming an exporter is detected

Public Credit Programmes and Firm Performance in Brazil

Credit rationing is a common phenomenon faced by firms, one that has negative implications for longâ term investments. In Brazil, public credit plays a key role in supporting firms: stateâ owned banks account for almost half of the outstanding credit. Public credit programmes aim at reducing credit restrictions, increasing competitiveness and job creation for small and medium enterprises. This article analyzes the effectiveness of the credit lines managed by two main public institutions in Brazil. Results show that access to public credit lines has a significant positive impact on firmsâ employment growth and exports, while no effect was found on wage differential. The impact on exports is driven by the increase in volumes among exporting firms rather than the probability of becoming an exporter.Peer Reviewedhttps://deepblue.lib.umich.edu/bitstream/2027.42/138401/1/dpr12250_am.pdfhttps://deepblue.lib.umich.edu/bitstream/2027.42/138401/2/dpr12250.pd

The spillover effects of the ICT cluster support in Córdoba

This paper presents evidence on the spillover effect associated with the support received by firms located in a City of Argentina, between 2003 and 2007. The rationale for the cluster development program was the presence of agglomeration economies and coordination failures that generated spillovers and therefore to a suboptimal allocation of resources. We use a panel of firms in the ICT sector for the period 2003-2011 that allowed us to control for the dynamics of firms’ sales and fixed-effect applying the System GMM estimator. We find that one additional participant in the program increases the sales of non-participants in the City of Córdoba by 0.7%

The spillover effects of the ICT cluster support in Córdoba

This paper presents evidence on the spillover effect associated with the support received by firms located in a City of Argentina, between 2003 and 2007. The rationale for the cluster development program was the presence of agglomeration economies and coordination failures that generated spillovers and therefore to a suboptimal allocation of resources. We use a panel of firms in the ICT sector for the period 2003-2011 that allowed us to control for the dynamics of firms’ sales and fixed-effect applying the System GMM estimator. We find that one additional participant in the program increases the sales of non-participants in the City of Córdoba by 0.7%

The Effects of Knowledge Spillovers through Labor Mobility

We estimate the effects of knowledge spillovers on firms’ performance and workers’ wages. We use an innovation support program as an exogenous shock to the knowledge of non-participant firms and an employer-employee dataset to track the mobility of workers—and knowledge diffusion—between firms. We find that non-participants that acquired new knowledge by hiring skilled workers exposed to the program increased employment, the average wage they pay, exports, and productivity. Finally, we find that—depending on the level of competition—a wage premium was paid either by participant or non-participant firms to retain or acquire workers

The Effects of Knowledge Spillovers through Labor Mobility

We estimate the effects of knowledge spillovers on firms’ performance and workers’ wages. We use an innovation support program as an exogenous shock to the knowledge of non-participant firms and an employer-employee dataset to track the mobility of workers—and knowledge diffusion—between firms. We find that non-participants that acquired new knowledge by hiring skilled workers exposed to the program increased employment, the average wage they pay, exports, and productivity. Finally, we find that—depending on the level of competition—a wage premium was paid either by participant or non-participant firms to retain or acquire workers