The French cluster policy and the R&D spending of SME and intermediate-sized enterprises

The French cluster policy Pôles de compétitivité has been launched in 2004 to foster collaborations between firms, research institutions, and training institutions. Many firms taking part in these clusters have obtained subsidies to finance R&D collaborative projects involving other firms and research institutions. This study analyzes the effects of taking part in a Pôle de compétitivité on the activity of firms. The effects are estimated by matching firms taking part in clusters to similar firms that remained out of the policy. This method only permits to estimate an effect for SME and intermediate-sized enterprises that spend less than 16 million euros in R&D per year, that are at least two years old, and that already realized R&D before taking part in a cluster. Firms participating in a Pôle de compétitivité would have increased their total R&D expenditures. Not all firms have taken part in a subsidized project, but they would have received more subsidies on average. These firms would have also benefited from higher amounts of Research tax credit (Crédit Impôt Recherche CIR) but overall we do not find any evidence of crowding out effect : public funds do not substitute private R&D. The effect seems to be additive : firms would add the amount of subsidies and tax credit to their private budget. Higher R&D spending is realized through an increase in investment and employment devoted to R&D. By cons, there is no significant short-term effect on the turnover and the number of patents. While cluster participation seems to increase R&D spending, it has not been possible to precisely disentangle the role played by the clusters and the role played by CIR, which has strongly reduced the cost of R&D at the end of the period of interest.