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Does Brexit Matter For Firms’ Innovation?

Author

Listed:
  • FLAVIO PICHLER

    (University of Verona, Italy)

  • STEFANO PISERÀ

    (��University of Genoa, Italy)

Abstract

Investigating the effects of Brexit on firms’ innovation behavior is pivotal to understand future possible economic growth and welfare effects of such policy decisions in the UK. By applying a difference-in-difference (DID) methodology on a sample of 2846 firm-year observations from 2013 to 2018, we address this question observing a decrease in UK firms’ research and development expenses compared to European firms. Specifically, we observe an R&D decrease of UK firms of about 10%, and of about 1.3% compared to EU firms. Our results offer important evidence for policymakers and UK regulators, warning on the future detrimental impact of Brexit on UK firms’ innovation policies.

Suggested Citation

  • Flavio Pichler & Stefano Piserã€, 2024. "Does Brexit Matter For Firms’ Innovation?," Journal of Financial Management, Markets and Institutions (JFMMI), World Scientific Publishing Co. Pte. Ltd., vol. 12(01), pages 1-17, June.
    • Handle: RePEc:wsi:jfmmix:v:12:y:2024:i:01:n:s2282717x23500123
    DOI: 10.1142/S2282717X23500123
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    More about this item

    Keywords

    R&D; Brexit; difference-in-difference; innovation;
    All these keywords.

    JEL classification:

    • G30 - Financial Economics - - Corporate Finance and Governance - - - General
    • G3 - Financial Economics - - Corporate Finance and Governance
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill

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