NBER Working Papers · 2026 · Sheila Campbell、Jaeger Nelson、Eli A. Schrag、Heidi L. Williams、Caleb K. Wroblewski
Abstract
In recent years, there has been Congressional interest in changing various policies related to research and development (R&D). Recent legislation has included provisions that would modify federal funding for R&D investments and tax provisions affecting the after-tax price of R&D. The Congressional Budget Office (CBO) has developed analytical frameworks for estimating how changes in R&D investments affect the economy and the federal budget. This paper describes the agency’s current analytical framework for modeling the economic effects of changes in federal funding for R&D, focusing on two distinct approaches that CBO has developed: an R&D capital stock approach and an R&D components approach.