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Do the Type and Number of Blockholders Influence R&D Investments? New evidence from Spain

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  • Josep A. Tribo
  • Pascual Berrone
  • Jordi Surroca

Abstract

Using data from 3,638 Spanish firms between 1996 and 2000, this article studies the relationship between the presence of large shareholders in the ownership structure of firms and R&D investment. Consistent with our theoretical contention, our results indicate that the impact of large shareholders on the R&D investment is (1) negative when blockholders are banks, (2) positive when blockholders are non‐financial corporations and (3) null when blockholders are individuals. In addition, we find a systematic negative relationship between the number of blockholders and R&D investment. Finally, we extend our study by analysing the influence that the combined effect between blockholder type and R&D investment has on the firm's economic performance. Results of this work provide relevant implications for policy makers and academic research.

Suggested Citation

  • Josep A. Tribo & Pascual Berrone & Jordi Surroca, 2007. "Do the Type and Number of Blockholders Influence R&D Investments? New evidence from Spain," Corporate Governance: An International Review, Wiley Blackwell, vol. 15(5), pages 828-842, September.
    • Handle: RePEc:bla:corgov:v:15:y:2007:i:5:p:828-842
    DOI: 10.1111/j.1467-8683.2007.00622.x
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    1. Hall, Bronwyn H., 1992. "Investment and Research and Development at the Firm Level: Does the Source of Financing Matter?," Department of Economics, Working Paper Series qt5j59j6x3, Department of Economics, Institute for Business and Economic Research, UC Berkeley.
    2. Luigi Zingales & Raghuram G. Rajan, 2003. "Banks and Markets: The Changing Character of European Finance," NBER Working Papers 9595, National Bureau of Economic Research, Inc.
    3. Marco Becht & Colin Mayer, 2002. "Corporate control in Europe," Revue d'économie politique, Dalloz, vol. 112(4), pages 471-498.
    4. Barca, Fabrizio & Becht, Marco (ed.), 2002. "The Control of Corporate Europe," OUP Catalogue, Oxford University Press, number 9780199257539, Decembrie.
    5. Bronwyn H. Hall, 1992. "Investment and Research and Development at the Firm Level: Does the Source of Financing Matter?," NBER Working Papers 4096, National Bureau of Economic Research, Inc.
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