Risk capital, private credit, and innovative production

James Ang and Jakob Madsen

Canadian Journal of Economics, 2012, vol. 45, issue 4, 1608-1639

Abstract: Although ideas production plays a critical role for growth, there has been only a modicum of research on the role played by financial forces in fostering new inventions. Drawing on Schumpeterian growth theory, this paper tests the roles of risk capital and private credit in stimulating knowledge production. Using panel data for 77 countries over the period 1965-2009, we find that countries with more developed financial systems are more innovative. A stronger patent protection framework, on the other hand, curbs innovative production.

JEL-codes: O30 O40 (search for similar items in EconPapers)
Date: 2012
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Citations: View citations in EconPapers (11)

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Working Paper: RISK CAPITAL, PRIVATE CREDIT AND INNOVATIVE PRODUCTION (2012)
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