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Public R&D Subsidies And Employment Growth - Microeconomic Evidence From Finnish Firms

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Executive Summary

This paper empirically explores whether the public financial support for entrepreneurial R&D affects employment growth at the firm level. The data from the Finnish companies suggests that the firms that have received public R&D funding have not generally witnessed any greater employment growth than other companies. However, the authors find that the public R&D support targeted to the certain types of R&D activities notably contribute to the creation of new jobs: employment in those firms that have received public funding for the R&D projects targeted to the new business areas has clearly grown relatively more than in other companies. The relationship between the firm's total innovation and employment growth is not statistically significant.

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