Evaluating the additionality and certification effects of research and innovation policy on small business start-ups: an inflow-sampling and counterfactual approach

Abstract

Using a unique inflow sample of business founded in 2004 and tracked ever since, this paper uses non-parametric treatment effect estimators to measure the additionality effect of a U.S. federal R&D program among small business start-ups. Our empirical analysis shows that recipient small business start-ups spent more than four times in research and development (R&D) as much as their observationally similar counterparts did, suggesting that the Small Business Innovation Research (SBIR) grants did not crowd out firm-financed R&D.