R&D, Agency Costs and Capital Structure: International Evidence

Sinclair Davidson and Robert Brooks

No 59, Econometric Society 2004 Australasian Meetings from Econometric Society

Abstract: We examine the impact of R&D intensity and agency costs on the value of firms across 13 economies. We find that R&D adds value while high agency costs reduce value. R&D adds value, however, even when agency costs are high. We show that in those firms where agency costs are high and R&D intensity is high the debt control hypothesis is at work. In contrast to the stylised fact of high R&D firms having low levels of debt, these firms have higher levels of deb

Keywords: R&D; Agency Costs; Capital Structure (search for similar items in EconPapers)
JEL-codes: D80 G32 O30 O57 (search for similar items in EconPapers)
Date: 2004-08-11
New Economics Papers: this item is included in nep-bec, nep-cfn and nep-mic
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Citations: View citations in EconPapers (2)

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