Please use this form to submit your study for inclusion into our database. It will be checked by a member of the Innovation Growth Lab team, who may be in contact to ask for more information. Your email address * Your name * Title * The name of the study Short summary A voucher programme for SMEs in Manchester, UK, to invest in creative projects showed significant positive, but short-term, effects on innovation and sales growth. A brief description of the project's goals and its current state Abstract <p>This report examines the results of a pilot study, which used a method of evaluation called randomised control trials (RCTs) to see if a popular business support scheme called Creative Credits worked effectively. The pilot study, which began in Manchester in 2009, was structured so that vouchers, or 'Creative Credits', would be randomly allocated to small and medium-sized businesses applying to invest in creative projects such as developing websites, video production and creative marketing campaigns, to see if they had a real effect on innovation. The research found that the firms who were awarded Creative Credits enjoyed a short-term boost in their innovation and sales growth in the six months following completion of their creative projects. However, the positive effects were not sustained, and after 12 months there was no longer a statistically significant difference between the groups that received the credits and those that didn’t. The report argues that these results would have remained hidden using the normal evaluation methods used by government, and calls for RCTs to be used more widely when evaluating policies to support business growth.</p> The full abstract of the study, if available Links http://www.nesta.org.uk/publications/creative-credits-randomized-controlled-industrial-policy-experiment Links to any published papers and related discussions Authors * Affiliations Academic and other institutes that the authors of the study are members of Delivery partner Organisations involved in delivering the trial, if appropriate Year Year Year199419951996199719981999200020012002200320042005200620072008200920102011201220132014201520162017201820192020202120222023202420252026 Month MonthJanFebMarAprMayJunJulAugSepOctNovDec Day Day12345678910111213141516171819202122232425262728293031 Journal Journal publishing the study, if available Publication stage * Working Paper Published Ongoing Research Forthcoming Discussion Paper Research theme * Entrepreneurship Innovation Business Growth Country Country or countries where this study took place. Topics What sort of topics does the study cover? Sample attributes Hypotheses / research question Can Creative Credits help firms overcome inertia and risk aversion leading to higher levels of collaboration between firms and thus innovation? Sample Trial population and sample selection The scheme was piloted in the Manchester City Region. It was open to SMEs in city of Manchester or one of 13 surrounding boroughs. SMEs from almost every sector were eligible except for those in primary and creative industries. The SMEs had to have fewer than 250 employees, less than £46m in turnover at time of application, be either limited liability, limited liability partnerships, general partnerships (added wave 2) or industrial or provident societies, and registered for VAT. 150 credits were available with intention to distribute equally between two waves (opened for applications in September 2009 and February 2010 respectively). The scheme was promoted through a number of channels such as a media PR campaign, business networks, and outbound telemarketing though it was encouraged to randomise the marketing process to avoid self-selection bias. Online applications were checked for suitability by Nesta project manager before firms were randomly assigned to the treatment group or control group. Companies house data suggested that 4,200 firms were eligible to apply by application - only 1 in 6 did. Number of treatment groups Size of treatment groups 150 SMEs Size of control group Unit of analysis Clustered? Yes No Cluster details Trial attributes Treatment description Randomly selected SMEs received a Creative Credit voucher of £4,000 that could be used to purchase a creative services from local creative SMEs (fitting a certain criteria). The firms were required to self-fund a minimum of £1,000, so the vouchers were worth a minimum of £5,000 in total. Before receiving the voucher, treatment group SMEs had to submit a final proposal project highlighting the creative business they had chosen to work with. They then had 5 months to complete the project. Rounds of data collection Baseline data collection and method Quantitative survey was administered immediately after the lottery took place. Data collection method and data collected Evaluation Outcome variables <p>Network Additionality: By how much did the award of a Creative Credit increase the probability that an SME entered into a new relationship with a creative business? Output Additionality: Probability of innovation, sales growth. Behavioural Additionality: Future innovation intentions, probability of innovation cooperation, Intended future cooperation with creative services providers.</p> Results <p>Network Additionality: The quantitative data suggests strong network additionality on receipt of a Creative Credit which is strongly supported by the interviews that took place immediately following the four/five month window within which the Creative Credit projects were completed. Output Additionality: In the six months following the Creative Credits project, there was a marked difference between firms in treatment and control group. Firms in treatment group were significantly more likely to introduce new products or services, or to introduce new process innovations. After 6 months this difference was no longer statistically significant, and even negative for process innovations. For sales, there is a weakly significant difference between the growth rate distributions between control and treatment groups. The percentage difference between average growth rates was even bigger at 12 months but no longer statistically significant. Behavioural Additionality: No significant effect of treatment on firms' intention to innovate in the future, on the probability of them undertaking innovation cooperation, or on intended future cooperation with creative services providers.</p> Intervention costs Vouchers were worth £4,000. Participating firms had to pay in an additional minimum of £1,000. The minimum total value of the intervention was thus £5,000. Cost benefit ratio Reference Bakhshi, H., 2013. 'Creative Credits: A Randomized Controlled Industrial Policy Experiment'. Nesta. Citation for use in academic references
