Arbeitspapier
Innovation, trade, and finance
This paper proposes a model where heterogeneous firms choose whether to undertake R&D or not. Innovative firms are more productive, have larger investment opportunities and lower own funds for necessary tangible continuation investments than non-innovating firms. As a result, they are financially constrained while standard firms are not. The efficiency of the financial sector and a country's institutional quality relating to corporate finance determine the share of R&D intensive firms and their comparative advantage in producing innovative goods. We illustrate how protection, R&D subsidies, and financial sector development improve access to external finance in distinct ways, support the expansion of innovative industries, and boost national welfare. International welfare spillovers depend on the interaction between terms of trade effects and financial frictions and may be positive or negative, depending on foreign countries' trade position.
- Sprache
-
Englisch
- Erschienen in
-
Series: CESifo Working Paper ; No. 3529
- Klassifikation
-
Wirtschaft
Neoclassical Models of Trade
Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
Entrepreneurship
Technological Change: Government Policy
- Thema
-
innovation
financial development
R&D subsidies
protection
Innovation
Industrielle Forschung
Innovationspolitik
Wohlfahrtseffekt
Internationaler Wettbewerb
Mehr-Sektoren-Modell
Theorie
- Ereignis
-
Geistige Schöpfung
- (wer)
-
Egger, Peter
Keuschnigg, Christian
- Ereignis
-
Veröffentlichung
- (wer)
-
Center for Economic Studies and ifo Institute (CESifo)
- (wo)
-
Munich
- (wann)
-
2011
- Handle
- Letzte Aktualisierung
-
10.03.2025, 11:44 MEZ
Datenpartner
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Objekttyp
- Arbeitspapier
Beteiligte
- Egger, Peter
- Keuschnigg, Christian
- Center for Economic Studies and ifo Institute (CESifo)
Entstanden
- 2011
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