We study the optimal design of R&D policies and corporate taxation as a dynamic mechanism design with externalities using the tools of public economics. Firms are heterogeneous in their research productivity, i.e., in the efficiency with which they convert a given set of R&D inputs into...

We study the optimal design of corporate taxation and R&D policies as a dynamic mechanism design problem with spillovers. Firms are heterogeneous in their research productivity, i.e., in the efficiency with which they convert a given set of R&D inputs into successful innovations and that...