Mandatory CSR regulation and R&D investments: Evidence from a quasi-natural experiment

Nemiraja Jadiyappa and Yogesh Chauhan

Finance Research Letters, 2023, vol. 55, issue PA

Abstract: This study examines the impact of mandatory CSR regulation on the innovations of Indian firms using the CSR regulation implemented in 2014 as a quasi-natural experiment setting. By employing the Difference in Differences approach, we show that CSR regulation positively impacted firm innovations, proxied using R&D intensity. Moreover, the results remain robust for various specifications and sample selection procedures. This positive relationship is consistent with the resource-based view that CSR is an intangible resource that firms use to gain specialized knowledge about the stakeholders, positively affecting innovations.

Keywords: Social responsibility; CSR regulation; Firm innovation; India; R&D intensity; Mandatory CSR; Emerging country (search for similar items in EconPapers)
Date: 2023
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:55:y:2023:i:pa:s1544612323001952

DOI: 10.1016/j.frl.2023.103822

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