Assessing the business performance effects of receiving publicly-funded science, research and innovation grants – Research Paper No 61( Revised )
Published: 6 September 2017
UK Research Councils spend around £1.7bn pa on supporting research. Here, we provide the first comprehensive assessment of these research grants on the performance of UK firms. Using data on funding and partnership from Gateway to Research on all funded projects by the UK Research Councils over the 2004 to 2016 period and business performance data from the Business Structures Database we have applied a difference-in-differences propensity score matching technique to evaluate the performance of UK firms who participated in publicly-funded research projects. Our analysis suggests five key conclusions. First, firms who participated in research projects funded by UK research councils grew their turnover and employment 5.8-6.0 per cent faster in the three years after the project, and 22.5-28.0 per cent faster in the six years after the project, than similar firms which did not receive support. Second, the impact of participating in projects is larger for firms in high-tech manufacturing and knowledge intensive services. Third, we find evidence that the impact of participating in projects is larger for small firms and those with lower starting productivity (turnover per employee). Growth impacts on firms in the top quartile of the productivity (turnover per employee) distribution are small. Fourth, support relevant to businesses is provided largely by EPSRC and Innovate UK. Participation in projects funded by both organisation increases both employment and turnover growth in the short and medium terms with only marginal differences in their impact. Fifth, the effects of grants vary depending on the size of the project. Participating in projects involving small and very large grants have smaller growth effects than medium-sized support packages. Our results have implications for the extent and targeting of future Research Council funding.
Our analysis is subject to a number of caveats. First, data limitations mean that we measure economic impacts using turnover and employment data rather than value added per worker or hour worked. Secondly, at this point we only consider the direct impacts on firms. Spillovers or multiplier effects may significantly enlarge these effects; displacement may reduce them. Both will be considered in a future study. Thirdly, data linking and the timing of some grant awards in recent years mean we are able to consider growth effects for only around two-thirds of firms which participated in publicly funded science and innovation projects.
International sectoral R&D trends after the global financial crisis: What can we learn for current policy?
In this Insight paper we review international evidence drawn from OECD databases which provide comparable time-series on sectoral R&D trends for the period 2008-2016. Our central focus is how R&D trends in UK sectors in the UK differed from those in other countries in the aftermath of the great financial crisis.
Total business R&D spending in the UK fell marginally from 2008-10 before recovering consistently to reach a level 23 per cent higher than that in the recession by 2016. R&D spending in services recovered significantly more quickly than that in manufacturing sectors, some of which have never regained the volume of R&D investment which they had in the recession.
In manufacturing, the poorer performing sectors have tended to be more traditional foundation industries. In services, poor performing sectors have tended to be those which grew rapidly in the pre-recession period – information and communication and financial services.
Published: 28 May 2020
Covid19: Critique and Proposals to Develop More Comprehensive and Inclusive Support for the SelfEmployed
The UK Chancellor Rishi Sunak has promised the self-employed they are ‘not forgotten’ and claimed that his headline programme – the Self-Employment Income Support Scheme (SEISS) – will protect 95% of those for whom self-employment is a main job. However, the policy excludes start-ups and, in an initial critique, we called for businesses without a 201819 Self-Assessment record (new businesses or those that did not become profitable until after April 6 2019) to have a chance to do their 2019-20 assessment early from April 6th 2020 for one month. This would then make them eligible for an SEISS payment in June 2020.
We also analysed Covid19 support for the self-employed in Germany and Denmark and found more comprehensive packages, supporting business costs and not just selfemployed income.
Following further discussion and analysis, this document outlines in detail the support for income losses and business losses or cash flow problems available to four categories of self-employed worker under UK Covid19 policy: the established self-employed for whom self-employment is a main job; the new(ish) self-employed for whom self-employment is a main job; the self-employed as a second job, and; the established self-employed who grew their businesses so self-employment became their main job in 2019-20. See Tables 1-4 below. We estimate that nearly I in 5 of the self-employed – over 750,000 people - are excluded from the SEISS and that many of the unprotected will have low or no social protection under Universal Credit and the Employment and Support Allowance. This means that some have no pay during periods of Covid19 sickness and self-isolation, a situation that could undermine the social distancing strategy. Home-based businesses without premises have no access to grant support with business losses and, we argue, are likely to be reluctant to apply for the Business Interruption Loan Scheme or, indeed, to be eligible for this fund.
Published: 2 April 2020
The UK Innovation Survey provides information on product/service and process innovation as well as the barriers to innovation activity for a relatively large number of UK firms.
In this paper we present the first local economic area analysis of this data derived from four surveys covering the 2002-04, 2004-06, 2006-08 and 2008-10 periods.
Published: 18 December 2014
Enterprise Research Centre
Warwick Business School
University of Warwick
Coventry CV4 7AL
Enterprise Research Centre
Aston Business School
Birmingham B4 7ET
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