This article provides an empirical investigation of the mechanism through which R&D influences export and tangible investment decisions. The analysis is based on a large representative and cross-country comparative sample of manufacturing firms across seven European countries. The novelty of this work lies in the three aspects. First, we expand the results on the R&D–export and R&D–investment relationships to a wide sample of cross-European firms. This differentiates from previous works based on single-country samples. Second, to the best of our knowledge, this study is the first in years which assess empirically the relationship between R&D and tangible investment at the micro level. Third, we control for endogeneity of R&D and simultaneity in firms’ decision whether to export and carry out tangible investment. The results of the analysis suggest that R&D positively affects export propensity and tangible investment. The results also reveal that neglecting endogeneity and simultaneity issues leads to underestimate the effect of R&D to both export and investment propensities.

R&D, export and investment decision: evidence from European firms / Carboni, Oliviero Antonio; Medda, Giuseppe. - In: APPLIED ECONOMICS. - ISSN 0003-6846. - 50:2(2018), pp. 187-201. [10.1080/00036846.2017.1332747]

R&D, export and investment decision: evidence from European firms

CARBONI, Oliviero Antonio;
2018

Abstract

This article provides an empirical investigation of the mechanism through which R&D influences export and tangible investment decisions. The analysis is based on a large representative and cross-country comparative sample of manufacturing firms across seven European countries. The novelty of this work lies in the three aspects. First, we expand the results on the R&D–export and R&D–investment relationships to a wide sample of cross-European firms. This differentiates from previous works based on single-country samples. Second, to the best of our knowledge, this study is the first in years which assess empirically the relationship between R&D and tangible investment at the micro level. Third, we control for endogeneity of R&D and simultaneity in firms’ decision whether to export and carry out tangible investment. The results of the analysis suggest that R&D positively affects export propensity and tangible investment. The results also reveal that neglecting endogeneity and simultaneity issues leads to underestimate the effect of R&D to both export and investment propensities.
R&D, export and investment decision: evidence from European firms / Carboni, Oliviero Antonio; Medda, Giuseppe. - In: APPLIED ECONOMICS. - ISSN 0003-6846. - 50:2(2018), pp. 187-201. [10.1080/00036846.2017.1332747]
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Utilizza questo identificativo per citare o creare un link a questo documento: http://hdl.handle.net/11388/179544
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