Foreign capital, credit constraints and continuity of firms' R&D

Pilar Beneito, M. E. Rochina-Barrachina and Amparo Sanchis-Llopis
Authors registered in the RePEc Author Service: Maria Engracia Rochina Barrachina

Applied Economics Letters, 2016, vol. 23, issue 3, 157-161

Abstract: In this article, we investigate the role of foreign capital participation as a means for firms to overcome the obstacle posed by credit constraints to sustain R&D investments. Using data for Spanish manufacturing firms in the period 1990-2006, we show that firms with foreign capital are significantly less likely to stop already initiated R&D projects and also more likely to sustain R&D investment when facing credit constraints. Our results are robust to positive selection into foreign capital participation, which we control through a set of variables chosen from a propensity score estimation, and to firms' fixed-effects.

Date: 2016
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Citations: View citations in EconPapers (3)

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Working Paper: Foreign Capital, Credit Constraints and Continuity of Firms’ R&D (2015)
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Persistent link: https://EconPapers.repec.org/RePEc:taf:apeclt:v:23:y:2016:i:3:p:157-161

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DOI: 10.1080/13504851.2015.1061635

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