Microeconometric evidence of financing frictions and innovative activity - a revision

Tiwari A.K., Pierre Mohnen, Franz Palm and Schim van der Loeff S.
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Schim van der Loeff S.: UNU-MERIT

No 2013-027, MERIT Working Papers from United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT)

Abstract: Using Dutch data we empirically investigate how financing and innovation vary across firm characteristics. We find that when firms face financial constraints, debt financing and innovation choices are not independent of firm characteristics, and RD slows down. In the absence of financial constraints, however, as they raise debt, firms become less inclined to innovate and the change in the propensity to innovate no longer varies with firm characteristics. We find that financing constraints faced, propensity to innovate, and RD intensity are not uniform across firm characteristics. A new Control Function estimator to account for heterogeneity and endogeneity has been developed.

Keywords: Multiple or Simultaneous Equation Models; Corporate Finance and Governance; Technological Change; Research and Development; Intellectual Property Rights (search for similar items in EconPapers)
JEL-codes: C30 G30 O30 (search for similar items in EconPapers)
Date: 2013
New Economics Papers: this item is included in nep-cfn, nep-ino, nep-knm, nep-sbm and nep-tid
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Persistent link: https://EconPapers.repec.org/RePEc:unm:unumer:2013027

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