Economists, in particular Bresnahan and Trajtenberg (1995), have recently drawn attention to the importance of generic or general purpose technologies (GPTs) and their significance for economic growth. An interesting part of this research identies coordination problems in the introduction of...

According to theory, direct R&D grants should be used for projects with low private returns, high social returns and high risk. R&D tax credits, on the other hand, allow firms to choose projects freely according to their private returns. Building on the standard R&D capital model, I develop a...

Subsidies to the Norwegian high-tech industries have traditionally been given as "matching grants", i.e. the subsidies are targeted, and the firms have to contribute a 50 % own risk capital to the subsidized projects. Our results suggest that grants do not crowd out privately financed R&D, but...