Effects of corporate and country governance on R&D investment: Evidence from emerging markets

Document Type

Article

Publication Date

1-1-2015

Abstract

© 2015 World Scientific Publishing Company. We investigate how corporate governance influences R&D across 13 emerging markets. We find that superior corporate governance increases corporate R&D spending. These results suggest that corporate governance may influence management's discretion to avoid risky innovative projects. We also find that the link between firm-level governance and corporate R&D is stronger in countries with weaker country-level governance. These results suggest substitutability between firm and country governance in generating innovation activities.

Publication Title

Singapore Economic Review

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