[2019-12]

Effect of R&D Cooperation-Friendly Government Policy on Performance of SMEs

Park, Joowoong

Moon Soul Graduate School of Future Strategy, KAIST

Yang, Jae-Suk

Moon Soul Graduate School of Future Strategy, KAIST

Abstract
This study investigated the effects of policies that encourage R&D cooperation on corporate
performance. Some governments appreciate the benefits of cooperation and strongly encourage R&D cooperation, as described in expectancy theory. However, contrary to expectations, intervention could lower performance due
to a decrease in intrinsic motivation and infringement on firm autonomy, according to self-determination theory. Data for approximately 3,618 SMEs were analyzed and the results showed that government intervention in favor
of R&D cooperation has negative effects on performance and that nonspontaneous R&D cooperation is associated
with lower performance than spontaneous R&D cooperation. In fact, nonspontaneous R&D cooperation was
associated with worse performance even than independent R&D cooperation, we outline the policy and academic
implications of these findings.

Keywords: motivation, government policy, R&D cooperation, SMEs, performance