R&D and innovation policy in the Western Balkans: Are there additionality effects?

Abstract

Abstract This article examines three types of additionality—input, output, and behavioural—in a cross-country framework. Besides conducting a systemic evaluation, which is scarce even in developed economies, this is among the first studies to investigate the effectiveness of R&D and innovation policy in transition economies. We estimate treatment effects for small and medium-sized firms in six Western Balkan countries. Empirical findings from matching estimators indicate no input and output additionality, while we find evidence of behavioural additionality. These results highlight the importance of conducting a systemic evaluation of innovation public support. We discuss theoretical and policy implications stemming from our empirical findings.