Effectiveness of direct and indirect R&D support

In the various theories of endogenous or semi-endogenous growth, it is argued that RandD drives productivity growth through increased choice or quality improvements in intermediate inputs or final goods (Grossman and Helpman, 1991; Aghion and Howitt, 1998; Barro and Sala-i-Martin, 2004). Private rates of return to RandD have been estimated to be in the 20 to 30 per cent range (see Hall, Mairesse and Mohnen [2010] for a survey). Ugur, Trushin, Solomon and Guidi (2016), in their meta-analysis of the empirical literature, conclude that the returns are very heterogeneous, maybe lower than the range reported by Hall et al. (2010), but still positive.