Financial constraints for R&D and innovation: New evidence from a survey experiment

Arbeitspapier

We utilize a new survey experiment to evaluate the existence and degree of financial constraints for R&D in the economy. The experiment does not only allow to deduct the presence of financial constraints, but also to evaluate their economic significance. Using data on German companies, we find that financial constraints for R&D exist but that their relevance might have been overestimated in the literature. Most R&D projects that have not been implemented because of financial constraints turn out to have low expected marginal rates of return. While this findings stands in some contrast to other studies, we also find several results that are in line with the literature: young firms are most constrained and the constraints occur at the intensive margin, i.e. our results do not suggest that non-innovative companies are deterred from innovation. Instead, highly innovative companies are restricted by the capital market.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: ZEW Discussion Papers ; No. 21-084

Classification and Topics

• Classification: Wirtschaft ; Corporate Finance and Governance: General ; Innovation; Research and Development; Technological Change; Intellectual Property Rights: General ; Innovation and Invention: Processes and Incentives ; Management of Technological Innovation and R&D ; Business Objectives of the Firm
• Subject: Innovation ; Financial Constraints ; Survey Experiment

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Czarnitzki, Dirk ; Giebel, Marek
• Event: Veröffentlichung
• (who): ZEW - Leibniz-Zentrum für Europäische Wirtschaftsforschung
• (where): Mannheim
• (when): 2021

Further information

• Handle: http://hdl.handle.net/10419/247693
• Last update: 10.03.2025, 11:41 AM CET