Working Paper Series
Karolina Ekholm and Johan Torstensson
High-Technology Subsidies in General Equilibrium: A Sector-Specific Approach
Abstract: We use a specific-factor model to examine the conditions
under which policy-makers are able to increase aggregate production of
high-tech goods by production or R&D-subsidies in the short and long run.
The difficulties for the policy-makers in designing a subsidy scheme that
succeeds in expanding aggregate high-tech production involve taking into
account the trade-off between resources used in R&D and production of
high-tech goods, the relative impact of different R&D activities on
productivity, and the ease with which resources may be attracted from the
non-high-tech sector of the economy to the various high-tech industries.
Keywords: PRODUCTION; RESEARCH AND DEVELOPMENT; PRODUCTIVITY; (follow links to similar papers)
JEL-Codes: F11; F12; (follow links to similar papers)
27 pages, September 1996
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