Firm-level effects of the Portuguese R&D tax credit: a microeconomic and sectoral analysis

Abstract

This Doctoral thesis investigates the impact of innovation policies, focusing on the Oslo Manual's role in shaping innovation research and the effects of R&D tax credits on firm behaviour and employment dynamics. Addressing gaps in the literature, it explores the Oslo Manual's academic influence, the allocation of highly qualified personnel in response to R&D tax credits, and the broader employment effects of these incentives. The first study (Chapter 3), "Accounting for the Oslo Manual: reflecting on the past and setting the stage for future research", applies bibliometric and textmetric analyses to over 1,300 research articles, assessing the Oslo Manual's adoption and relevance over three decades. The findings highlight its increasing importance, particularly after 2008, and its integration with fields such as entrepreneurship, performance, and knowledge management. The second study (Chapter 4), "Does R&D tax credit impact firm behaviour? Micro evidence for Portugal", investigates how R&D tax credits influence the allocation of PhD holders across firms with different R&D intensities. Using firm-level data (1995–2017) from Portugal, the study finds that tax credits significantly affect the distribution of PhD holders in medium-high and high R&D intensity firms after three years. This research shifts the focus from R&D expenditure to human capital effects. The third study (Chapter 5), "Do R&D tax credits really boost hiring? Insights into employment dynamics", employs a difference-in-differences approach with a staggered design to assess employment effects in Portugal (2014–2022). Results indicate a substantial increase in R&D staff, with sector-specific variations, such as an 18.4% rise in information and communication and 12.3% in manufacturing. This thesis advances knowledge by bridging theoretical and empirical perspectives on science and technology policies. It provides insights into the Oslo Manual's influence, the human capital effects of R&D tax credits, and sectoral employment dynamics, offering evidence-based recommendations for policymakers and future research.