The Role of National Innovation Programs in Stimulating International Cooperation in Innovation

Abstract. The impacts of innovation programs may go far beyond improvements in private R&D expenditures and patents. In this paper we propose that domestic-level programs, not necessarily designed to increase international links in science and technology, may indirectly foster international cooperation in innovation, by providing additional funding, experience in domestic collaboration, and learning about how to apply for public funding. To test this hypothesis we examine if firms with public support from national and regional sources are more likely to undertake cooperative research with foreign partners than nonsupported firms, after accounting for a series of controls. Results indicate that participation in national and regional public innovation programs has a positive effect in terms of additional international innovation cooperation. The study contributes to understanding of behavior of innovative firms, international collaboration in innovation, and positive externalities that may be associated with domestic innovation policies. Policy implications include the importance of recognizing how public support for private innovation induces non-anticipated spillovers to other innovation activities, the need to consider behavioral changes when evaluating public innovation policies, and the role of national and regional policies in supporting transnational innovation networks in regions where domestic firms (particularly SMEs) face considerable disadvantages in applying for public funding at supra-national agencies.