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Publication type
FT ranked journal articlePublication Year
2012Journal
Research PolicyPublication Volume
41Publication Issue
3Publication Begin page
580Publication End page
591
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Many countries spend sizeable sums of public money on R&D grants to alleviate debt and equity gaps for small firms’ innovation projects. In making such awards, knowledgeable government officials may certify firms to private financiers. Using a unique Belgian dataset of 1107 approved requests and a control group of denied requests for a specific type of R&D grant, we examine the impact of subsidies on small firms’ access to external equity, short term and long term debt financing. We find that obtaining an R&D subsidy provides a positive signal about SME quality and results in better access to long-term debt.Keyword
R&D Subsidies, Government Policy, SMEs, Financial Constraints, Certification Hypothesis, Behavioural AdditionalityKnowledge Domain/Industry
Accounting & Financeae974a485f413a2113503eed53cd6c53
10.1016/j.respol.2012.01.001