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Research, development, and firm growth. Empirical evidence from European top R&D spending firms

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  • García-Manjón, Juan V.
  • Romero-Merino, M. Elena

Abstract

Following recent literature, we present a model of endogenous firm growth with R&D investment as one of the main mechanisms of growth. Our study evidences a positive effect of R&D intensity on the sales growth by using OLS, quantile regressions, and GMM system estimators for a sample of 754 European firms for the 2003–2007 period. We also find this association is more intense in high-growth firms and is especially significant when referring to high-technology sectors. This paper gives empirical support to those recommendations from policy makers and business leaders for maintaining the R&D expenditures especially in high-technology sectors even when facing a recession.

Suggested Citation

  • García-Manjón, Juan V. & Romero-Merino, M. Elena, 2012. "Research, development, and firm growth. Empirical evidence from European top R&D spending firms," Research Policy, Elsevier, vol. 41(6), pages 1084-1092.
    • Handle: RePEc:eee:respol:v:41:y:2012:i:6:p:1084-1092
    DOI: 10.1016/j.respol.2012.03.017
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