Abstract

The purpose of this paper is two folds. First, we present an overview of Taiwan's technological policy measures. Second, we then evaluate the effectiveness of investment tax credit for R&D, personnel training and establishment of an international brand name in the Statute for Industrial Upgrading and Promotion.
In the paper, we conduct a survey of 161 Taiwanese manufacturing firms to investigate the effects. Our analysis, using the Linear Structural Relation model (LISREL), suggests that government investment tax credits generate a positive impact on firms' expenditure in the area of R&D and establishment of international brand name. Furthermore, we also find that there exists a positive linkage between firms' expenditure and their profit as well as research efficiency.