Analysis of the Effect of Corporate Employment Creation by Government R&D Support

Abstract

Recently, as job creation has become a social issue, discussions about job creation through government R&D support are also actively being discussed. In this study, we tried to analyze empirically the effects of government R&D support of Korea on corporate employment. In this study, National Science and Technology Information Service (NTIS) data is used in order to obtain information on the government R&D support in Korea. NTIS data provides information on the support of Korean government R&D projects by year. Total 61,546 R&D projects conducted by the Small and Medium Enterprises (SMEs) from 2011 to 2016 were used for analysis. When analyzing the performance after the government support, it is necessary to distinguish whether the performance is due to the superior characteristics of the enterprise itself or by government support. In this study, Propensity Score Matching (PSM) method and multivariate matching method are simultaneously used for analysis. As a result of the analysis, government R&D beneficiaries showed an increase in terms of both the number of employees and total wage, which mean the quantity of employment. However, it was confirmed that the wage per employee of the beneficiary company decreased. The wage per employee means the quality of employment. Through this study, the employment creation effect of government R&D support and the necessity that both quantitative and qualitative effects should be considered in employment creation were demonstrated empirically.