English, Article edition: Beggar Thy Neighbor? The In-State, Out-of-State, and Aggregate Effects of R&D Tax Credits Daniel J Wilson

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  • article
Language
  • English

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Title
  • Beggar Thy Neighbor? The In-State, Out-of-State, and Aggregate Effects of R&​D Tax Credits
Author
  • Daniel J Wilson
Physical Description
  • article
Notes
  • The proliferation of R&​D tax incentives among U.S. states in recent decades raises two questions: (i) Are these tax incentives effective in increasing in-state R&​D? (ii) How much of any increase is due to R&​D being drawn away from other states? This paper answers (i) "yes" and (ii) "nearly all." The paper estimates an augmented R&​D factor demand model using state panel data from 1981 to 2004. I estimate that the long-run elasticity of in-state R&​D with respect to the in-state user cost is about -2.5, while its elasticity with respect to out-of-state user costs is about &​plus;2.5, suggesting a zero-sum game among states. Copyright by the President and Fellows of Harvard College and the Massachusetts Institute of Technology.
  • RePEc:tpr:restat:v:91:y:2009:i:2:p:431-436
Language
  • English
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