3,235 research outputs found
Does internal finance matter for R&D? New evidence from a panel of Italian firms
No full textThis paper investigates the relationship between finance and R&D for a panel of more than 1000 Italian manufacturing firms. While Italian firms obtain a significant share of their financing from debt, the results from a unique survey show that firms use virtually no debt to finance R&D. Because Italian firms typically do not receive external equity, the obvious source of innovation financing is internal cash flow. The sensitivity of capital investment to cash flow for small and medium-large firms is estimated, testing for the presence of informational frictions in the credit market for companies performing R&D activities. A GMM method that controls for unobserved firm-specific effects and endogenous explanatory variables is used. Cash flow plays an important role in explaining capital investment, especially for small firms. Interestingly, when the measure of firms' innovative activities is considered, significant differences are found between the sub-samples of small and medium-large firms. While small innovative firms are subject to relevant financing constraints, larger companies investing in R&D have easier access to external financing. Copyright The Author 2008. Published by Oxford University Press on behalf of the Cambridge Political Economy Society. All rights reserved., Oxford University Press.
Industrial districts and financial constraints to innovation
No full textInformational frictions between borrowers and lenders are particularly acute for innovative firms undertaking high‐risk projects. As a consequence, banks may end up denying credit to them. However, the literature on relationship finance predicts that a closer relationship between credit suppliers and obligors is deemed to alleviate information asymmetries, hence preventing credit rationing from occurring. The question of whether such situations also apply to innovative firms has so far remained relatively unexplored. Using a cross‐section of Italian manufacturing firms, I find that credit constraints appear to be more severe for firms undertaking innovative activities, although such effects are weaker when measures of R&D intensity are included. The empirical analysis also shows that firms located in an industrial district have easier access to external finance. If I move to consider firms engaged in substantial R&D activities located in a district, results suggest that they can benefit from better financial conditions.industrial districts, relationship finance, credit rationing, innovation, G21, O30, D45, R12,
Investments, financing constraints and buyouts: the effect of private equity investors on the sensitivity of investments to cash flow
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What role can mutual guarantee consortia play for financing innovation? A firm-level study for Italy
No full textIt is widely acknowledged that firms performing R&D investments are very likely to undergo financial constraints due to their specific characteristics, which make external debt an imperfect substitute for internal finance, especially for small sized enterprises (Carpenter and Petersen, 2002; Hall, 2002). This situation calls into question the role that mutual guarantee consortia (MGC) might have in mitigating the effect of financial constraints on the innovative activities performed by small and medium enterprises (SMEs). In this paper, we explore how effectively this role is played by exploiting a large dataset of guarantee-backed loans provided by Eurofidi (an Italian mutual guarantee consortium), including both financial and non-financial information on applicant firms. We find that, when the destination of loans is considered, applications demanded to sustain R&D and innovation activities have a lower probability of being accepted, but they also have a lower probability of turning into bad loans (conditional on loan's acceptance), thus highlighting the potential absence of a minimising default risk behaviour by the granting institution (Boyes et al., 1989) with respect to the observed characteristics of the applicants. Copyright © 2011 Inderscience Enterprises Ltd
Growth of born globals: the role of the entrepreneur's personal factors and venture capital
No full textAssessing the contribution to innovation of private equity investors: a study on European buyouts
No full textLe banche ed il finanziamento dell'innovazione. Problematiche, opportunità e nuovi sviluppi dopo Basilea
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