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BEIS - The impact of public support for innovation on firm outcomes

BEIS - The impact of public support for innovation on firm outcomes

Frontier Economics was commissioned by the Department for Business, Energy and Industrial Strategy (BEIS) and Innovate UK to study the economic impact of public sector support for private sector innovation. 

The Report describes itself as follows:

The analysis focuses on policies providing direct support for business innovation through grants, loans, advice and access to specialist services operated by Innovate UK (a nondepartmental body sponsored by BEIS) and the National Measurement System (NMS). 

We examine how receipt of support affects firm-level economic performance measured in terms of survival, employment and turnover up to 5 years after support. 

We do not consider explicitly the impact on productivity given the short time series of post-treatment data available. However, recent evidence that turnover growth is a precursor to productivity growth suggests that looking at other indicators of firm performance is a critical step in assessing the impact of such policies. 

Our study focuses on the outcome additionality of support. To our knowledge this study represents one of the first attempts to do so using firm-level micro data on programme participation and economic performance for the UK.

The Report can be downloaded from the BEIS website here.

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