Heterogenous Impacts of National Research Grants on Academic Productivity

Measuring the impact of research grants on academic productivity is essential for determining optimal funding allocation, selection processes, and evaluation criteria. This study evaluates the effect of Japan’s primary national research grant (KAKENHI) on academic productivity in economics using novel administrative data from the Japan Society for the Promotion of Science (JSPS). To control for potential endogeneity and omitted variable bias, we employ a regression discontinuity (RD) design based on the peer-review scores used by the JSPS to select the applications to be funded. The results show that research grants increase the number of papers and citations in economics by 10–15% and 20–26%, respectively. The cost-benefit analysis indicates that the effect is three times greater for young scientists than for other recipients. Further, the results demonstrate that receiving the grant encourages junior scientists with tenure to independently carry out high-impact research, while it typically leads researchers without tenure to pursue quantity over quality.