The influence of direct funding, indirect funding, and institutional design policies on industrial research and development

Date of Award


Degree Type


Degree Name

Doctor of Philosophy (PhD)


Public Administration


Funding, R&D, Public administration

Subject Categories

Science and Technology Policy


During the last decade there have been fundamental changes in Research and Development (R&D) policies and the mechanisms used to implement those policies. Before 1960, although direct funding mechanisms were prevalent, there were only modest tax mechanisms, and a minuscule number of cooperative mechanisms. Interaction between government, university, and industrial labs was uncommon. In the past ten years that situation has changed tremendously. Policy complexity has replaced relative simplicity but the real impact of these changes has not yet been ascertained.

The mechanisms used for policy intervention with industrial R&D can be classified into three groups: direct government support mechanisms, indirect government support mechanisms, and institutional design mechanisms. Direct mechanisms are grants, loans, appropriations, or government contracts. Indirect mechanisms are various tax law provisions allowing firms to recoup costs on R&D. Institutional design mechanisms concentrate on the creation of new institutions amenable to higher levels of R&D performance. A great variety of such institutions exist, including research and development limited partnerships, joint ventures, and multiple forms of government, industry, and university interaction.

Current policy consists of all three types of government involvement with industrial R&D. The relative influence of each mechanism is a source of great concern. Too often, the debate focuses only on the desired outcome of policy mechanisms--the "policy-push"--to the exclusion of the characteristics or environment of the laboratory the--"lab-pull".

What best explains the differential utilization of the policy mechanisms by industrial R&D laboratories: policy-push or lab-pull? This study attempts to lend some insights into this question by examining policy-push and lab-pull explanations for policy mechanism utilization. To provide the foundation for the empirical portions of the study, several chapters deal with the justifications for and evolution of the various policy mechanisms. The interaction between internal laboratory structures and policy mechanism utilization is considered using data collected as part of the National Comparative Research and Development project (NCRDP). An assessment of the overall influence of the policy mechanisms, drawing from both the detailed policy discussion and the NCRDP data, is given.


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