Do R&D subsidies affect SMEs’ access to external financing?

Miguel Meuleman and Wouter De Maeseneire

Research Policy, 2012, vol. 41, issue 3, 580-591

Abstract: Many countries spend sizeable sums of public money on R&D grants to alleviate debt and equity gaps for small firms’ innovation projects. In making such awards, knowledgeable government officials may certify firms to private financiers. Using a unique Belgian dataset of 1107 approved requests and a control group of denied requests for a specific type of R&D grant, we examine the impact of subsidies on small firms’ access to external equity, short term and long term debt financing. We find that obtaining an R&D subsidy provides a positive signal about SME quality and results in better access to long-term debt.

Keywords: R&D subsidies; Government policy; SMEs; Financial constraints; Certification hypothesis; Behavioural additionality (search for similar items in EconPapers)
JEL-codes: G32 H25 O38 (search for similar items in EconPapers)
Date: 2012
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (128)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:respol:v:41:y:2012:i:3:p:580-591

DOI: 10.1016/j.respol.2012.01.001

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