R&D Investment and Financing Constraints of Small and Medium-Sized Firm

Arbeitspapier

This study tests for financial constraints on R&D investment and how they differ from capital investment. To identify constraints in the access to external capital, we employ a credit rating index. Our models show that internal constraints, measured by mark-ups, are more decisive for R&D than for capital investment. For external constraints, we find a monotonic relationship between the level of constriction and firm size for both types of investment. Thus, external constraints turn out to be more binding with decreasing firm size. On the contrary, we do not find such monotonic relationships for internal constraints. Differentiation by firms? age does not support lower constraints for older firms.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: ZEW Discussion Papers ; No. 08-047

Classification and Topics

• Classification: Wirtschaft ; Innovation and Invention: Processes and Incentives ; Management of Technological Innovation and R&D
• Subject: R&D Investment ; Capital Investment ; Financial Constraints ; Panel Data ; Censored Regression Models ; Forschungsfinanzierung ; Verschuldungsrestriktion ; Industrielle Forschung ; Investition ; Kreditwürdigkeit ; Deutschland

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Czarnitzki, Dirk ; Binz, Hanna L.
• Event: Veröffentlichung
• (who): Zentrum für Europäische Wirtschaftsforschung (ZEW)
• (where): Mannheim
• (when): 2008

Further information

• Handle: http://hdl.handle.net/10419/24743
• Last update: 10.03.2025, 11:43 AM CET