Not just financial support? Another role of public subsidy in university–industry research collaborations

Abstract

Management of university–industry research collaboration (hereafter UIC) is the key to its success. In this respect, government can play an essential role in UIC. A public subsidy for research and development (hereafter R&D) is not only an important financial support for UIC but may also serve as a useful means of promoting trust among UIC members, resulting in higher innovation performance. However, few empirical studies have investigated the role a public R&D subsidy plays in promoting trust in UIC. To this end, by using original survey data, this study examines empirically whether a public R&D subsidy for UIC contributes to trust formation and, thus, to higher innovation performance based on trust. Our findings suggest that a public R&D subsidy promotes trust formation, which then increases the innovation performance of UIC participants, partially mediating the more direct effects of R&D subsidy on innovation performance.

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