A national study shows that R&D grants to firms significantly boost growth and create jobs.
Grants totalling £8bn led to growth worth £43bn and created around 150,000 jobs.
The findings back the government’s policy of subsidising promising industrial research – the so-called practice of “picking winners”.
The analysis is the first to suggest that the policy might work at a national level.
Prof Stephen Roper, from the Warwick Business School and director of the Enterprise Research Centre, led the research. He said it was the first time that such a detailed analysis had been undertaken.
“Our study is the first time we have been able to do a comprehensive assessment across the whole gamut of science support provided by a UK public sector for companies,” he told BBC News.
“It shows very clearly that grants to support R&D have a positive impact, creating jobs and fuelling growth in the hi-tech, high value-added sectors that the UK must encourage to remain competitive on the world stage.”
Prof Roper and his colleagues tracked 15,000 hi-tech firms which received government R&D grants. It found that on average these firms employed 23% more people after six years compared with firms that did not receive grants. Turnover grew by 28% and productivity by 6% over the same period.
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