Gernot Hutschenreiter

Bio: Gernot Hutschenreiter is an academic researcher. The author has contributed to research in topics: Innovation system & Productivity. The author has an hindex of 4, co-authored 16 publications receiving 81 citations.

Tax Incentives for Research and Development

Abstract: The majority of OECD countries provide support to R&D both through direct subsidies and, increasingly, by means of tax incentives. For a considerable period of time, Austria has been offering an instrument of fiscal support to R&D – the R&D tax allowance – that is rather generous by international standards. However, the R&D tax allowance shows some weaknesses. The recent reform of fiscal aid for R&D is designed to eliminate some of these weaknesses by additional measures (a new R&D allowance for R&D expenditure based on the OECD definition, an R&D premium for firms that do not manage to make sufficient profit). This reform of tax incentives for R&D does not leave any firm worse off than before. On the other hand, the system of incentives is becoming increasingly complex, which in turn raises the costs of administration and compliance by firms. Until now the actual use and effects of the R&D tax allowance have not been very transparent and no evaluation has been presented so far. It is recommended to evaluate the new set of instruments according to international standards after they have been in use for three years.

Austria's "Technology Gap" in Foreign Trade

Abstract: Compared with other industrialized countries, Austria exhibits a substantial "technology gap" in foreign trade that is revealed in a low share of high-technology products in manufacturing exports and in low unit values. The resulting deficit in foreign trade with high-technology products totaled almost ATS 22 billion in 1994. A positive structural change has been taking place, however, over the last two decades. In order to accelerate this shift toward technologically more sophisticated products, the ratio of research expenditures to GDP will need to be raised from the current 1.5 percent to the EU average of 2 percent. The additional funds required to achieve this goal over the period of six years total some ATS 40 billion.

Economic policy issues for the next decade

Abstract: -Introduction - The Case for a New Policy Framework K. Aiginger, G. Hutschenreiter. Economic Policy for the 21st Century J.E. Stiglitz. -1: The Future of Macroeconomic Policy in the European Union. The Future of Macroeconomic Policy in the European Union C. Allsopp. Economics Policies - Old and New? P. Mooslechner. The Case for Straightening Out Macroeconomic Policy in the European Union M. Marterbauer. -2: Economic Policy Consequences of Population Ageing. Towards a Positive Equilibrium for Ageing Societies G. Esping-Andersen. Population Ageing - A Problem not a Crisis N. Barr. Economic and Social Policy in an Ageing Europe: Employment and Pensions A. Larsson. The German Pension Reform - A Major Improvement on a PAYG System G.G. Wagner. Activation as an Option for an Ageing Society A. Guger. -3: The Potential benefits and Risks of the Enlargement of the Union in Central Europe. Eastern Enlargement: Some Basics A. Steinherr. Optimal Path into the EMU: Big Bank or Gradualism? J. Fidrmuc. Institutional Aspects of EU Enlargement Andras Inotai. Health not Wealth D. Gros. What Can We learn About Labour Market Adjustment in Candidate Countries from Literature? P. Huber. -4: The Future of Public Finance. International Tax Competition: A New Framework for Analysis P. Birch Sorensen. An Age of Diminished Taxation? Francesco Daveri. What Future for The EC Budget? E. Kitzmantel. The Development of Tax Structures in the EU Member States H. Kramer. -5: Competitiveness in the Science-Based Economy. The Public Policy Challenge of the New Economy P.A. Geroski. Competitivenessin the Science-Based Economy - The Irish Experience S. Dorgan. Institutions and Innovation in the European Union S. Micossi. What Do We Know About the New Economy? K. Aiginger. -6: The Scope for Economic Policy Advice. Empirical Economics Research and Economic Policy Advice: Some Remarks G. Kirchgassner. Economic Policy Consulting: Some Personal Reflections W. Franz. Political Economy in Economic Policy Advice H. Kramer.

The New Growth Evidence

Abstract: Why do growth rates differ? This paper surveys the recent empirical literature on economic growth, starting with a discussion of stylized facts, data problems, and statistical methods. Six research questions are emphasized, drawing on growth and convergence research. In answering these questions, the paper argues that efficiency has grown at different rates across countries, casting doubt on neoclassical models in which technology is a public good. The latter half of the paper rounds up a variety of findings before providing answers to all six questions, including a short summary of how differences in growth rates arise.

Research and Development Productivity and Spillovers: Empirical Evidence at the Firm Level

Abstract: A variety of methods have been used to investigate the empirical relationship between research and development (R&D) spending and the productivity of firms. The most widely employed frameworks are the production function and the associated productivity framework. In these settings, productivity growth is related to expenditures on R&D, and an attempt is made to estimate statistically the part of productivity growth that can be attributed to R&D activities. This article surveys the expansive body of empirical literature on this subject and finds a large and significant impact of R&D on firm performance on average. However, the estimated returns vary considerably between the different studies due to differences across data samples and econometric models, as well as methodological and conceptual issues. A meta-analysis on the studies surveyed reveals that the estimated rates of return do not significantly differ between countries, whereas the estimated elasticities do. Furthermore, the estimated elasticities are significantly higher in the 1980s and consistently higher in the 1990s compared with the 1970s. Hence, contrary to a widely held belief, we find no convincing evidence of an exhaustion of R&D opportunities in the last two decades.

Research And Development Productivity And Spillovers: Empirical Evidence At The Firm Level

Abstract: A variety of methods have been used to investigate the empirical relationship between research and development (R&D) spending and the productivity of firms. The most widely employed frameworks are the production function and the associated productivity framework. In these settings, productivity growth is related to expenditures on R&D, and an attempt is made to estimate statistically the part of productivity growth that can be attributed to R&D activities. This article surveys the expansive body of empirical literature on this subject and finds a large and significant impact of R&D on firm performance on average. However, the estimated returns vary considerably between the different studies due to differences across data samples and econometric models, as well as methodological and conceptual issues. A meta-analysis on the studies surveyed reveals that the estimated rates of return do not significantly differ between countries, whereas the estimated elasticities do. Furthermore, the estimated elasticities are significantly higher in the 1980s and consistently higher in the 1990s compared with the 1970s. Hence, contrary to a widely held belief, we find no convincing evidence of an exhaustion of R&D opportunities in the last two decades. Copyright Blackwell Publishers Ltd, 2005.

Intellectual property box regimes: effective tax rates and tax policy considerations

Abstract: 11 European countries now operate IP Box regimes that provide substantially reduced rates of corporate tax for income derived from important forms of intellectual property. We incorporate these policies into forward-looking measures of the cost of capital, effective marginal tax rates and effective average tax rates. We show that the treatment of expenses relating to IP income is particularly important in determining the effective tax burden. A key finding is that regimes that allow expenses to be deducted at the ordinary corporate income tax rate, as opposed to the IP Box tax rate, may result in negative tax rates and can thereby provide a subsidy to unprofitable projects. We assess the specific design features of different regimes against the possible policy aim of improving the incentives to undertake R&D investment in a country. While some countries have tried to tie the policy to real activities, others have designed a policy targeted at the income streams associated with intellectual property. A key concern is the role that IP Boxes may play in increased, and possibly harmful, tax competition between European countries.