재무연구 제 권 호 (2011년 5월)
Asian Review of Financial Research, Vol., No..
pp.570~591
pp.570~591
R&D Investment and Internal Finance: Evidence from Korean Small and Medium Sized Enterprises
Minshik Shin School of Business Administration, Kyungpook National University,
Sooeun Kim School of Business Administration, Kyungpook National University,
This paper shows evidence that the innovative SMEs use more internal finance to fund R&D investment in the existence of the asymmetric information. The innovative SMEs also use more internal finance to fund asset-counted R&D investment than the cost-counted R&D investment, because the intangible assets created by asset-counted R&D investment may act as an innovative driver that has a greater multiplier effect on the firm value. Moreover, the innovative SMEs use more internal finance to smooth R&D investment in the existence of the external financial constraints. These findings suggest a new policy implication into how internal finance can be particularly valuable for the R&D smoothing of the innovative SMEs; that is, internal finance is an important aspect of innovation policy for the innovative SMEs.
Minshik Shin
Sooeun Kim
This paper shows evidence that the innovative SMEs use more internal finance to fund R&D investment in the existence of the asymmetric information. The innovative SMEs also use more internal finance to fund asset-counted R&D investment than the cost-counted R&D investment, because the intangible assets created by asset-counted R&D investment may act as an innovative driver that has a greater multiplier effect on the firm value. Moreover, the innovative SMEs use more internal finance to smooth R&D investment in the existence of the external financial constraints. These findings suggest a new policy implication into how internal finance can be particularly valuable for the R&D smoothing of the innovative SMEs; that is, internal finance is an important aspect of innovation policy for the innovative SMEs.
