Does Cluster Policy Trigger R&D Activity? Evidence from German Biotech Contests

European Planning Studies, Vol. 21, No. 11, 2013

27 Pages Posted: 20 Feb 2012 Last revised: 28 Nov 2013

See all articles by Dirk Engel

Dirk Engel

University of Applied Sciences Stralsund; Rhine-Westphalia Institute for Economic Research (RWI-Essen)

Timo Mitze

Rhine-Westphalia Institute for Economic Research (RWI-Essen)

Roberto Patuelli

University of Bologna - Department of Economics

Janina Reinkowski

CESifo (Center for Economic Studies and Ifo Institute) - Social Policy and Labour Markets

Date Written: January 2012

Abstract

This paper evaluates the R&D enhancing effects of two large public grant schemes for the German biotechnology industry (BioRegio, BioProfile). Both grant schemes are organized in the form of contents for cooperation with the goal to foster the performance of innovative firms by their organization in research clusters. We apply a Difference-in-Differences estimation technique in a generalized linear model framework, which allows us to control for different initial regional conditions in R&D activity of the biotech sector. Our econometric findings support the view that winners generally outperform non-winning participants during the treatment period, thus indicating that exclusive funding as well as the stimulating effect of being a “winner” have positive effects on R&D activity in the short-term. Apart from this direct winner effect, for the non-winning participants no beneficial indirect effect due to a mobilization of local actors during the application phase could be detected. Finally, first attempts in estimating the long-term effects of the contests for cooperation approach on the winner regions’ R&D activity in the post-treatment period show ambiguous results.

Keywords: Biotechnology, R&D Policies, Cluster, Difference-in-Differences Estimation

JEL Classification: O38, C23

Suggested Citation

Engel, Dirk and Mitze, Timo and Patuelli, Roberto and Reinkowski, Janina, Does Cluster Policy Trigger R&D Activity? Evidence from German Biotech Contests (January 2012). European Planning Studies, Vol. 21, No. 11, 2013, Available at SSRN: https://ssrn.com/abstract=2007931

Dirk Engel

University of Applied Sciences Stralsund ( email )

Zur Schwedenschanze 15
Stralsund, DE 18437
Germany

HOME PAGE: http://www.fh-stralsund.de

Rhine-Westphalia Institute for Economic Research (RWI-Essen) ( email )

Hohenzollernstr. 1-3
Essen, DE 45128
Germany

Timo Mitze (Contact Author)

Rhine-Westphalia Institute for Economic Research (RWI-Essen) ( email )

Hohenzollernstr. 1-3
Essen, 45128
Germany

Roberto Patuelli

University of Bologna - Department of Economics ( email )

via Anghera' 22
Rimini, 47921
Italy
+39-0541-434276 (Phone)
+39-02-700419665 (Fax)

HOME PAGE: http://https://sites.google.com/site/patuellihomepage/

Janina Reinkowski

CESifo (Center for Economic Studies and Ifo Institute) - Social Policy and Labour Markets ( email )

Munich, 81879
Germany

HOME PAGE: http://www.cesifo-group.de/reinkowski-j

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