Innovative capability and financing constraints for innovation: More money, more innovation?

Arbeitspapier

This study presents a novel empirical approach to identify financing constraints for innovation based on the concept of an ideal test (Hall 2008). Firms were offered a hypothetical payment and were asked to choose between alternatives of use. If they selected additional innovation projects, they must have had some unexploited investment opportunities that were not profitable using more costly external finance. We attribute constraints for innovation not only to lacking financing, but also to firms' innovative capability. Econometric results show that financial constraints do not depend on the availability of internal funds per se, but that they are driven by innovative capability.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: ZEW Discussion Papers ; No. 09-081 [rev.2]

Classification and Topics

• Classification: Wirtschaft ; Innovation and Invention: Processes and Incentives ; Management of Technological Innovation and R&D ; Multiple or Simultaneous Equation Models: Discrete Regression and Qualitative Choice Models; Discrete Regressors; Proportions
• Subject: innovation ; financing constraints ; innovative capability ; multivariate probit models ; Forschungsfinanzierung ; Risikokapital ; Verschuldungsrestriktion ; Innovation ; Probit-Modell ; Schätzung ; Deutschland

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Hottenrott, Hanna ; Peters, Bettina
• Event: Veröffentlichung
• (who): Zentrum für Europäische Wirtschaftsforschung (ZEW)
• (where): Mannheim
• (when): 2012

Further information

• Handle: http://hdl.handle.net/10419/67508
• Last update: 10.03.2025, 11:43 AM CET