| WHEN TOUGH GET GOING: PERFORMANCE OF R&D IN THE ADVERSE ECONOMIC CONDITIONS |
Received:October 15, 2017 Revised:October 15, 2017 |
Key Words: economic adversity, R&D, growth, global economic crisis, resource-based view |
| Author Name | Affiliation | | yiyi su* | Tongji University | | Rekha Rao-Nicholson | Newcastle University London | | Di Fan | Curtin University |
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Abstract: |
| Prior studies note that the generalized economic adversity can limit firms’ R&D investments due to financial constraints, yet conversely, create opportunities for firms to discover novel approaches and potentially increase R&D. Limited studies investigate the links between the economic adversity, R&D and performance across the firm-specific factors. In the context of 2008 economic crisis, using a resource-based view, we investigate this relationship using 11,003 firms with an unbalanced panel of 40,599 firm-year observations from 65 countries for the period 2003-2013. We find that under economic adversity firm effects can explain the links between R&D expenditures and firm performance. The low market-share and high leveraged firms are likely to enjoy a higher level of returns to R&D investments. |
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