Why not all young firms invest in R&D

David Audretsch (), Segarra Blasco, Agustí, 1958- and Mercedes Teruel

Working Papers from Universitat Rovira i Virgili, Department of Economics

Abstract: This article aims to analyze the different impact that some factors may exert on the probability that a small young firm invests intensively in R&D. Recently, an increasing amount of the literature makes reference to the vital role played by a small number of young firms in generating jobs and increasing efficiency levels. However, not all new firms invest in R&D. Departing from the definition of YICs (firms younger than 6 years old, fewer than 250 employees and with more than 15% of their revenues invested in R&D activities), and with an extensive sample of the Spanish Community Innovation Survey between 2004- 2010, we try to determine: i) those factors that cause firms to become YICs (innovative young small firms) or YNICs (moderately innovative young small firms); ii) what is the difference in the impact of those factors between YICs and YNICs. Our results show that factors such as initial innovation capacity and cooperation in R&D projects enhance the probability of becoming a YIC. Nevertheless, factors such as export potential and market uncertainty may influence the decision to invest moderately and become a YNIC. Keywords: Innovation, Policy, YICs. JEL Classifications: O31, D21

Keywords: Empreses -- Innovacions tecnològiques; Innovacions tecnològiques -- Política governamental; Investigació; Conducta organitzacional; Empreses petites i mitjanes; Empreses -- Creació; 65 - Gestió i organització. Administració i direcció d'empreses. Publicitat. Relacions públiques. Mitjans de comunicació de masses (search for similar items in EconPapers)
Date: 2014
New Economics Papers: this item is included in nep-com, nep-cse, nep-ent, nep-eur, nep-ino, nep-sbm and nep-tid
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Citations: View citations in EconPapers (12)

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Journal Article: Why don't all young firms invest in R&D? (2014)
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Persistent link: https://EconPapers.repec.org/RePEc:urv:wpaper:2072/225296

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