Does R&D intensity influence leverage? Evidence from Indian firm-level data

Saibal Ghosh

MPRA Paper from University Library of Munich, Germany

Abstract: The paper examines the association between corporate leverage and their investment in R&D. Towards this end, it develops certain testable propositions. These propositions are tested using a dataset of manufacturing firms in India covering the period 1995-2005. The estimates support the fact that firms which make high efforts on R&D investments exhibit lower leverage ratios. Additionally, the estimates reveal that the dampening effect of R&D-intensity on leverage is the highest for foreign private firms. For state-owned firms however, R&D activity appears to be positively associated with leverage.

Keywords: R&D intensity; leverage; Tobit model; India (search for similar items in EconPapers)
JEL-codes: O32 (search for similar items in EconPapers)
Date: 2012-03-17
New Economics Papers: this item is included in nep-cfn, nep-ino and nep-sbm
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Citations: View citations in EconPapers (2)

Published in Journal of International Entrepreneurship 2.10(2012): pp. 158-175

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Journal Article: Does R&D intensity influence leverage? Evidence from Indian firm-level data (2012)
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