Financing behaviour of R&D investment in the emerging markets: the role of alliance and financial system
Authors: Alam, A., Uddin, M. and Yazdifar, H.
Journal: R and D Management
Volume: 49
Issue: 1
Pages: 21-32
eISSN: 1467-9310
ISSN: 0033-6807
DOI: 10.1111/radm.12303
Abstract:This paper examines the financing behaviour of research and development (R&D) investments in emerging markets. Drawing on institutional theory and using panel data of generalized methods of moment estimation for a sample of 302 firms from 20 countries during the period 2003–2015, we find that emerging market firms tend to use internal funds for financing R&D investments. Interesting results emerged when the sample was divided as alliance and non-alliance firms, and bank-based and market-based financial systems. The results show that R&D financing behaves differently for alliance and non-alliance firms. Alliance firms use both internal and external funds for R&D investments, while non-alliance firms do not use external funds. We also document that a country's financial system influences the choice of available sources of finance. Firms from countries that follow a bank-based financial system tend to rely on external funds while firms from countries that follow a market-based financial system depend more on internal funds for financing R&D investments. This study is important as it provides new evidence on financing R&D investments in emerging countries taking into account the institutional arguments of financing choices, and so should guide stakeholders about appropriate sources of R&D financing.
https://eprints.bournemouth.ac.uk/33706/
Source: Scopus
Financing behaviour of R&D investment in the emerging markets: the role of alliance and financial system
Authors: Alam, A., Uddin, M. and Yazdifar, H.
Journal: R & D MANAGEMENT
Volume: 49
Issue: 1
Pages: 21-32
eISSN: 1467-9310
ISSN: 0033-6807
DOI: 10.1111/radm.12303
https://eprints.bournemouth.ac.uk/33706/
Source: Web of Science (Lite)
Financing behaviour of R&D investment in the emerging markets: the role of alliance and financial system
Authors: Alam, A., Uddin, M. and Yazdifar, H.
Journal: R & D Management
Volume: 49
Issue: 1
Pages: 21-32
ISSN: 0033-6807
Abstract:This paper examines the financing behaviour of research and development (R&D) investments in emerging markets. Drawing on institutional theory and using panel data of generalized methods of moment estimation for a sample of 302 firms from 20 countries during the period 2003–2015, we find that emerging market firms tend to use internal funds for financing R&D investments. Interesting results emerged when the sample was divided as alliance and non-alliance firms, and bank-based and market-based financial systems. The results show that R&D financing behaves differently for alliance and non-alliance firms. Alliance firms use both internal and external funds for R&D investments, while non-alliance firms do not use external funds. We also document that a country's financial system influences the choice of available sources of finance. Firms from countries that follow a bank-based financial system tend to rely on external funds while firms from countries that follow a market-based financial system depend more on internal funds for financing R&D investments. This study is important as it provides new evidence on financing R&D investments in emerging countries taking into account the institutional arguments of financing choices, and so should guide stakeholders about appropriate sources of R&D financing.
https://eprints.bournemouth.ac.uk/33706/
Source: BURO EPrints