Elusive carrot: tax incentives for R and D

Journal Article · · Regulation; (United States)

OSTI ID:6946402

Brown, K M

The 1981 Economic Recovery Tax Act created a tax credit for firms that increased their research and development (R and D) spending, but this provision has had some unintended consequences because it provided a carrot that was no longer needed and which could actually speed the decline of R and D efforts. The credit is having little impact on long-term research planning because it expires at the end of 1985. When Congress decides whether to extend, modify, or drop the credit, it would do better to replace the carrot and stick approach with a stable, predictable policy environment that will benefit industrial innovation.

• Research Organization: American Enterprise Inst., Washington, DC
• OSTI ID: 6946402
• Journal Information: Regulation; (United States), Journal Name: Regulation; (United States) Vol. 7; ISSN REGUD
• Country of Publication: United States
• Language: English

Related Subjects

29 ENERGY PLANNING, POLICY, AND ECONOMY
290200 -- Energy Planning & Policy-- Economics & Sociology
290500* -- Energy Planning & Policy-- Research
Development
Demonstration
& Commercialization
ECONOMIC POLICY
ECONOMIC RECOVERY TAX ACT
FINANCIAL INCENTIVES
GOVERNMENT POLICIES
INDUSTRY
LAWS
RESEARCH PROGRAMS
TAX CREDITS