We study the effects of credit rationing on research and development (R&D) investment using survey and accounting data on a large representative sample of manufacturing small- and medium-sized enterprises (SMEs). Our econometric model accounts for the endogeneity of our credit rationing indicator and employs an innovative theory-based identification strategy. We find that credit rationing has a significantly negative effect on both the probability to set up R&D activities and on the level of R&D spending (conditioned on the R&D decision), but the overall estimated reduction in R&D spending is largely to be associated with the first effect. © 2014 Western Economic Association International.

R&D and credit rationing in SMEs

VEZZULLI, ANDREA
2014

Abstract

We study the effects of credit rationing on research and development (R&D) investment using survey and accounting data on a large representative sample of manufacturing small- and medium-sized enterprises (SMEs). Our econometric model accounts for the endogeneity of our credit rationing indicator and employs an innovative theory-based identification strategy. We find that credit rationing has a significantly negative effect on both the probability to set up R&D activities and on the level of R&D spending (conditioned on the R&D decision), but the overall estimated reduction in R&D spending is largely to be associated with the first effect. © 2014 Western Economic Association International.
Economics and Econometrics; Business, Management and Accounting (all)
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Utilizza questo identificativo per citare o creare un link a questo documento: http://hdl.handle.net/11383/2059627
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