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State Aid, R&D, and the Digital Content of Trade

By: Castelli, Chiara.
Contributor(s): Guarascio, Dario | Jestl, Stefan | Stehrer, Robert.
Material type: materialTypeLabelBookSeries: wiiw Working Papers: 237Publisher: Wien : Wiener Institut für Internationale Wirtschaftsvergleiche (wiiw), 2023Description: 19 S., 7 Tables and 1 Figure, 30cm.Subject(s): Factor content of trade | ICT capital | state aid | sectoral R&D capabilityCountries covered: European Unionwiiw Research Areas: International Trade, Competitiveness and FDIClassification: F14 | O30 Online resources: Click here to access online Summary: We test for the role of state aid as a driver of digital competitiveness at the industry level, focusing on the digital factor content of trade. Results show that state aid may increase digital competitiveness, particularly in R&D-intensive industries and in relation to the export of (digital) capital-intensive goods and services. Interestingly, aggregate state aid appears to be more effective than specific R&D funds in explaining the performance of country-industries in foreign markets.
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Paper WIIW Library 5.700/237 (Browse shelf(Opens below)) Available 1000010006707

We test for the role of state aid as a driver of digital competitiveness at the industry level, focusing on the digital factor content of trade. Results show that state aid may increase digital competitiveness, particularly in R&D-intensive industries and in relation to the export of (digital) capital-intensive goods and services. Interestingly, aggregate state aid appears to be more effective than specific R&D funds in explaining the performance of country-industries in foreign markets.

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The Vienna Instiute for International Economic Studies (wiiw)