Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/247305 
Year of Publication: 
2021
Series/Report no.: 
LEM Working Paper Series No. 2021/36
Publisher: 
Scuola Superiore Sant'Anna, Laboratory of Economics and Management (LEM), Pisa
Abstract: 
The paper focuses on the capital structure of firms in their early years of operation. Through the lens of Pecking Order Theory, we study how the pursuit of innovation influences the reliance of firms on different types of internal and external finance. Panel analyses of data on 7,394 German start-ups show that innovation activities are relevant predictors of the start-ups' revealed preferences for finance, and that the nature of these effects on the type and order of financing sources depends on the degree of information asymmetries specific to research and development activities, human capital endowments, and the market introduction of new products and processes.
Subjects: 
Innovation
information asymmetries
start-up
pecking order
entrepreneurial finance
JEL: 
G32
O16
O30
Document Type: 
Working Paper

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