We have evaluated the impact of the Swedish Innovation Agency’s (Vinnova) innovation programs 2010-2012 with collaboration requirements on the turnover of smaller companies and the number of employees, during and after the program. The results show positive effects on the turnover of participating companies.

Technological innovation is essential to achieve sustainable growth for the frontier economies, including Western Europe, Japan and the US. It is often argued that innovation is enhanced by collaboration between industry, research and government. Sweden spends roughly SEK 3 billion each year on publicly funded innovation aid with some form of collaboration requirements. The Swedish government has also initiated an innovation council with representatives from the government, industry, academia and other parts of society to foster collaboration.

We have studied the impact of governmental innovation aid with collaboration requirements. The report gathers the existing evidence from research and evaluations about the effects of innovation support with demands for collaboration and addresses the following questions:

• Does collaboration lead to increased innovation, competitiveness, and growth?
• How should innovation aid programs with collaboration requirements be organized and implemented for effectiveness and efficiency?

We have evaluated the impact of the Swedish Innovation Agency’s (Vinnova) innovation programs 2010-2012 with collaboration requirements on the turnover of smaller companies and the number of employees, during and after the program. The results show positive effects on the turnover of participating companies.

We have also studied whether these innovation programs with collaboration requirements correlate with regional economic renewal. The programs correlate with regional renewal in terms of both technology and sectorial composition. However, we consider there to be scope for making innovation programs more effective. In line with previous research, we show that the smallest companies (1-9 employees) do not receive any positive (or negative) effect from the subsidies.

By targeting programs towards both technological and sectorial renewal reduces the risk of established industries and companies receiving all the value of the aid. In addition, previous research has shown that support for basic research, as opposed to product development, leads to greater knowledge spillovers beyond established companies. Aid programs should also be designed in such a way that the value of the collaboration component can be measured, which will further our understanding of when collaboration is important and when it is better to issue support without the demand for collaboration.

In light of the conclusions of this project, we recommend that the actors who design and implement innovation programs:

Consider which groups of companies expect to benefit from financial aid with collaboration requirements;

• Design a training program in collaboration for new companies;
• Design innovation programs with collaboration requirements such that it contributes to industrial renewal and large knowledge spillovers;
• Design innovation programs with collaboration requirements based on existing evidence.
• Design innovation program in such a way as to allow for stringent evaluations.