The Financing of R&D Investments: Effects on Growth and Financial Structure
Author(s)
Garofalo, Giuseppe
Morganti, Patrizio
Date Issued
2010
Type
Article
Abstract
The financing of innovation impacts on economic growth. What’s, among bank-based or market-based system, the best organizational form? The paper supports the view that both forms have to be merged into a unique
approach (law and finance view) embracing not only the overall quality of the financial services’ supply (financial
services view) but also the related legal aspects.
In particular, the paper agrees with the thesis that the financial structure of the economy emerges endogenously depending both on the firms’ R&D investment choices and on their initial wealth level.
The paper presents also an empirical validation of the financial services and, more specifically, of the law and finance view, carried out over the period 1980-2008. A focus is dedicated to the Chinese case, which shows strong economic growth and increasingly efficient financial sector, in despite of the weakness of the legal system.
Additional information
JEL codes: D82, E44, G20, K20, O32, P48 Journal of Applied Economic Science is indexed in RePEC, SCOPUS, CEEOL and Index Copernicus databases
Citation
Garofalo G., Morganti P., "The Financing of R&D Investments: Effects on Growth and Financial Structure", ‛Journal of Applied Economic Sciences’, volume V, Issue 2(12), 71-94, 2010
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