Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/247693 
Year of Publication: 
2021
Series/Report no.: 
ZEW Discussion Papers No. 21-084
Publisher: 
ZEW - Leibniz-Zentrum für Europäische Wirtschaftsforschung, Mannheim
Abstract: 
We utilize a new survey experiment to evaluate the existence and degree of financial constraints for R&D in the economy. The experiment does not only allow to deduct the presence of financial constraints, but also to evaluate their economic significance. Using data on German companies, we find that financial constraints for R&D exist but that their relevance might have been overestimated in the literature. Most R&D projects that have not been implemented because of financial constraints turn out to have low expected marginal rates of return. While this findings stands in some contrast to other studies, we also find several results that are in line with the literature: young firms are most constrained and the constraints occur at the intensive margin, i.e. our results do not suggest that non-innovative companies are deterred from innovation. Instead, highly innovative companies are restricted by the capital market.
Subjects: 
Innovation
Financial Constraints
Survey Experiment
JEL: 
G30
O30
O31
O32
L21
Document Type: 
Working Paper

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