Subsidies, financial constraints and firm innovative activities in emerging economies

Simona Mateut

Small Business Economics, 2018, vol. 50, issue 1, No 8, 162 pages

Abstract: Abstract This paper investigates the relationship between public subsidies and firm innovation in transition and developing economies, which are likely to have less developed financial markets. Innovation includes the introduction of new products or services and the upgrade of existing ones, which is of particular relevance for these economies. The results obtained using alternative measures of financial constraints and market competition, within a range of econometric techniques, suggesting a positive relation between public subsidies and the innovative activities of 11,998 firms across 30 Eastern Europe and Central Asian countries. This correlation is stronger for firms more likely to be financially constrained.

Keywords: Innovation; Subsidies; Financial constraints; Emerging countries (search for similar items in EconPapers)
JEL-codes: G30 H2 O16 O3 O57 (search for similar items in EconPapers)
Date: 2018
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Citations: View citations in EconPapers (54)

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DOI: 10.1007/s11187-017-9877-3

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