IDEAS home Printed from https://ideas.repec.org/a/taf/apfiec/v22y2012i20p1665-1678.html
   My bibliography  Save this article

Innovation activity and corporate financing: evidence from a developing economy

Author

Listed:
  • Ann Ling-Ching Chan

Abstract

The present study investigates the extent to which technology-related asymmetric information between corporate managers and outside investors has an adverse effect on the external financing activities of innovation-intensive firms. The results indicate that innovation-intensive firms are more likely to engage in equity financing when their valuation multiples are higher than those of their industry peers. This finding is more pronounced among firms with low institutional shareholdings and fewer brokers following them. The empirical evidence supports the misvaluation explanation, as well as the timing and type of security issuance if the agency problem is severe. The findings provide insights into the timing of company financing choices in a highly innovative developing economy.

Suggested Citation

  • Ann Ling-Ching Chan, 2012. "Innovation activity and corporate financing: evidence from a developing economy," Applied Financial Economics, Taylor & Francis Journals, vol. 22(20), pages 1665-1678, October.
  • Handle: RePEc:taf:apfiec:v:22:y:2012:i:20:p:1665-1678
    DOI: 10.1080/09603107.2012.667547
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1080/09603107.2012.667547
    Download Restriction: Access to full text is restricted to subscribers.

    As the access to this document is restricted, you may want to search for a different version of it.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:taf:apfiec:v:22:y:2012:i:20:p:1665-1678. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Chris Longhurst). General contact details of provider: http://www.tandfonline.com/RAFE20 .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.