Abstract:
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This paper analyses the effect of R&D
investment on firm growth. We use an extensive
sample of Spanish manufacturing and service firms.
The database comprises diverse waves of Spanish
Community Innovation Survey and covers the period
2004–2008. First, a probit model corrected for sample
selection analyses the role of innovation on the
probability of being a high-growth firm (HGF).
Second, a quantile regression technique is applied to
explore the determinants of firm growth. Our database
shows that a small number of firms experience fast
growth rates in terms of sales or employees. Our
results reveal that R&D investments positively affect
the probability of becoming a HGF. However, differences appear between manufacturing and service
firms. Finally, when we study the impact of R&D
investment on firm growth, quantile estimations show
that internal R&D presents a significant positive
impact for the upper quantiles, while external R&D
shows a significant positive impact up to the median.
Keywords : High-growth firms, Firm growth, Innovation activity.
JEL Classifications : L11, L25, L26, O30 |