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The Impact of the Financial Crisis on Innovation and Growth: Evidence from Technology Research and Development

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An increasing body of literature discusses how and to which extent the financial crisis of 2007-2009 transmits to the real economy. This paper investigates the impact of the financial crisis of 2007-2009 on corporate investment, in particular research and development (R&D) expenditures. We measure financial constraints and financial distress of firms and investigate whether those measures have a significant impact on R&D during the financial crisis. We find evidence that financial distress has little impact for our sample of listed technology firms and we argue that the credit supply shock does not play a decisive role as financially constrained firms invest comparatively more than non-constrained firms during the crisis.

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  • Alfranseder, Emanuel & Dzhamalova, Valeriia, 2014. "The Impact of the Financial Crisis on Innovation and Growth: Evidence from Technology Research and Development," Knut Wicksell Working Paper Series 2014/8, Lund University, Knut Wicksell Centre for Financial Studies.
    • Handle: RePEc:hhs:luwick:2014_008
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    2. Jan Behringer & Thomas Theobald & Till van Treeck, 2014. "Einkommens- und Vermögensverteilung in Deutschland: Eine makroökonomische Sicht," IMK Report 99-2014, IMK at the Hans Boeckler Foundation, Macroeconomic Policy Institute.

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    More about this item

    Keywords

    Financial Constraints; Financial Distress; Financial Crisis; R&D; Investment;
    All these keywords.

    JEL classification:

    • G31 - Financial Economics - - Corporate Finance and Governance - - - Capital Budgeting; Fixed Investment and Inventory Studies
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
    • G33 - Financial Economics - - Corporate Finance and Governance - - - Bankruptcy; Liquidation

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