Here’s some good news for U.S. states trying to spur an economic recovery in the years ahead: The R&D tax credit has a significant effect on entrepreneurship, according to a new study led by an MIT professor. Moreover, the study finds a striking contrast between two types of tax credits. While the R&D tax credit fuels high-quality new-firm growth, the state-level investment tax credit, which supports general business needs, actually has a slightly negative economic effect on that kind of innovative activity. The underlying reason for the difference, the study’s…
