Sources of finance for R&D investment: Empirical evidence from Portuguese SMEs using dynamic estimators
Zélia Serrasqueiro
Management and Economics Department, Beira Interior University; Researcher at CEFAGE-UE (Centre for Advanced Studies in Management and Economics), Covilhã, Portugal
Paulo Maçãs Nunes
Management and Economics Department, Beira Interior University; Researcher at CEFAGE-UE (Centre for Advanced Studies in Management and Economics), Covilhã, Portugal
João Leitão
Instituto Superior Técnico, Campus do Taguspark, Lisbon, Portugal
PP: 187 - 206
Abstract
This paper makes two specific contributions to the SME literature: (i) it is pioneering in using the two-step estimation method, considering SME R&D intensity as dependent variable and cash flow, short and long-term debt and government subsidies as determinants; and (ii) the empirical evidence obtained allows us make important empirical contributions.
Cash flow and short-term debt, regardless of the respective level, influence positively R&D intensity by SMEs. Secondly, long-term debt and government subsidies are only important for increased R&D intensity for higher levels of long-term debt and government subsidies. The multiple empirical evidence obtained in this study allows us to make important suggestions to policy-makers, as well as to SME managers/owners.
Keywords
dynamic estimators; entrepreneurial finance; external finance; internal finance; R&D investment; SMEs
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