The intellectual spoils of war: How government spending on defence research benefits the private sector

a column by Enrico Moretti, Claudia Steinwender and John Van Reenen for VOX: CEPR’s Policy Portal

Defence RandD is a major component of government-sponsored RandD in many developed economies, and the effect of defence RandD expenditures on private sector innovation and economic growth has been a hotly debated topic for many years.

This column presents a systematic analysis across all OECD countries which suggests that a 10% increase in defence RandD results in a 4% increase in private RandD. It also reveals evidence of spillovers between countries, with increases in government-funded RandD in one country appearing to increase private RandD spending in the same industry in other countries.

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Labels:
defence_RandD, government-finder_RandD, private_RandD, innovation,

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