Creative credits:a randomized controlled industrial policy experiment

Abstract

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.