A toolkit of policies to promote innovation

Bloom, Nick, Van Reenen, John ORCID: 0000-0001-9153-2907 and Williams, Heidi (2019) A toolkit of policies to promote innovation. CEP Discussion Papers (CEPDP1634). London School of Economics and Political Science. Centre for Economic Performance, London, UK.

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Abstract

Economic theory suggests that market economies are likely to under-provide innovation due to the public good nature of knowledge. Empirical evidence from the US and other advanced economies supports this idea. We summarize the pros and cons of different policy instruments for promoting innovation and provide a basic “toolkit” describing which policies are most effective, based on our reading of the evidence. In the short-run, R&D tax credits or direct public funding seem the most productive, but in the longer-run increasing the supply of human capital (e.g. relaxing immigration rules or expanding university STEM admissions) are likely more effective.

Item Type:	Monograph (Discussion Paper)
Official URL:	https://cep.lse.ac.uk/_new/publications/discussion...
Additional Information:	© 2019 The Author(s)
Divisions:	Economics Centre for Economic Performance
Subjects:	H Social Sciences > HC Economic History and Conditions
JEL classification:	O - Economic Development, Technological Change, and Growth > O3 - Technological Change; Research and Development > O31 - Innovation and Invention: Processes and Incentives O - Economic Development, Technological Change, and Growth > O3 - Technological Change; Research and Development > O32 - Management of Technological Innovation and R&D
Date Deposited:	05 Mar 2024 16:21
Last Modified:	05 Mar 2024 16:21
URI:	http://eprints.lse.ac.uk/id/eprint/121815

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