| Budget Amount *help |
¥3,250,000 (Direct Cost: ¥2,500,000、Indirect Cost: ¥750,000)
Fiscal Year 2017: ¥1,170,000 (Direct Cost: ¥900,000、Indirect Cost: ¥270,000)
Fiscal Year 2016: ¥910,000 (Direct Cost: ¥700,000、Indirect Cost: ¥210,000)
Fiscal Year 2015: ¥1,170,000 (Direct Cost: ¥900,000、Indirect Cost: ¥270,000)
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| Outline of Final Research Achievements |
We studies how the combination of subsidies and commitment to self-funding affects R&D and its efficiency. We develop a simple model where a funding body requires a credit-constrained recipient with private information to commit to a minimum amount of self-funding for the project. We derive the optimal subsidization policy, which depends crucially on the cost of funds for both the funding body and the recipients, as well as the positive externalities of projects and potential social loss from diversion.
We find that i) requiring self-funding commitment may be desirable only if the funding body's financing cost is lower than that of the recipient and ii) self-funding commitment is efficiency enhancing if the recipient's cost of funding and social loss from diversion are high, and the positive externalities from the project are not too high.
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