1865.1

Effects of Targeted R&D Grants on Number

of Employees

Our results for the number of employees, i.e., labor demand, are presented in Table 4. Note that we estimate two specifications for each of the three models (i– iii). In the first, referred to as our basic specification (columns 1, 3, and 5), we estimate the DiD regression specification in Eq. (2), and in the second specification, we present an extended model in which we re-estimate the regression with the treatment effects interacted with firm size. This is of interest because previous studies (e.g., Bronzini & Iachini, 2014) have indicated that the effects of government support programs might be more pronounced for small firms.