Economics serving society

Research clusters: How public subsidies matter ?

Marie-Laure Cabon-Dhersin and Emmanuelle Taugourdeau

European public authorities encourage the geographic grouping of public and private organisations. The goal is to get them to share their research, and to assure a more efficient use of public funds and better distribution of the results of the research. In France, the 2006 launch of the “centres of scientific and technological excellence” (pôles d’excellence scientifique et technologique) demonstrated a will to stimulate and support Research and Development (R & D) work in regional planning policy.
In this article, Cabon-Dhersin and Taugourdeau make a theoretical analysis of the question of the emergence of a research partnership between the public sector and the private sector through the public funding of the research. This partnership, commonly called “a research cluster”, is here defined as cooperation between the two sectors that allows an increase in the transmission of knowledge from the public sphere to the private sphere. The principal result is the following: the emergence of a durable research cluster depends simultaneously on the level of the public subsidy put into the public laboratory and on the valuing of that research via exams, the publication of scientific articles and the like. If the subsidy is too small, it is damaging to the coexistence of the public and private sectors: the public sector is no longer viable (team gains are too low) and all the researchers end up in the private sector. Conversely, subsidy levels that are too high discourage geographic linking because the private sector chooses to distance itself from the public sector in order to avoid the effects of competition in research. With an intermediate level of subsidy, a research cluster leads to a substantial increase in research efforts in the public sector, but does not encourage the private sector to increase its own. The total “benefits” from research efforts, geographic grouping and public subsidies gained by the two sectors is always higher in what is called the intermediate case.
Original title of the academic article : “Research clusters: How public subsidies matter ?”
Published in : CES Working Paper, 2015.14
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