Estimating the Economic Effects of Federal Investment in Research and Development

FROM THE CONGRESSIONAL BUDGET OFFICE (CBO), MAY 1, 2026.

Presentation about work by Sheila Campbell, Jaeger Nelson, Eli Schrag, Heidi Williams, and Caleb Wroblewski at the NBER Entrepreneurship and Innovation Policy and the Economy Conference

SUMMARY:

In recent years, Congress has shown interest in making policy changes that affect research and development (R&D), such as:

• Modifications to federal funding for R&D investment (for example, the CHIPS and Science Act, Public Law 117-167) and
• Modifications to tax provisions that affect the after-tax price of private R&D (for example, the 2025 reconciliation act, P.L. 119-21).

This presentation details CBO’s current basis of assessment for modeling the economic effects of changes in federal funding for nondefense R&D, with the goal of eliciting feedback.

 CBO DOCUMENT;

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