Does Government Spending Crowd Out R&D Investment? Evidence from Government-Dependent Firms and Their Peers

We provide evidence that managerial incentives to manipulate real activities can influence the effectiveness of fiscal policy. Increases in federal spending lead government-dependent firms to expand research and development (R&D) investment whereas industry-peer firms contract. The net result is...

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Bibliographic Details
Published in:Journal of financial and quantitative analysis 2022-05, Vol.57 (3), p.888-922
Main Authors: Ngo, Phong T. H., Stanfield, Jared
Format: Article
Language:English
Subjects:
Companies
Crowding
Earnings
Fiscal policy
Government spending
Incentives
Investment advisors
Investments
Organizational effectiveness
Peers
R&D
Research & development
Research & development expenditures
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