Research, innovation, and bankruptcy: evidence from European manufacturing firms

Abstract This paper investigates the effects of R&D and innovation activities of firms on the risk of bankruptcy. The analysis is carried out on data drawn from the EU-EFIGE Survey and Amadeus Database (Bureau Van Dijk) on European manufacturing firms over the years 2009–2014. The empirical evid...

Full description

Saved in:
Bibliographic Details
Published in:Industrial and corporate change 2022-01, Vol.31 (1), p.137-160
Main Authors: Agostino, Mariarosaria, Scalera, Domenico, Succurro, Marianna, Trivieri, Francesco
Format: Article
Language:English
Citations: Items that this one cites
Items that cite this one
Online Access:Get full text
Tags: Add Tag
No Tags, Be the first to tag this record!
cited_by cdi_FETCH-LOGICAL-c354t-3d87563de8838af5014d87f0d616e3b58c93dd6db55be937f5d4be3671509e363
cites cdi_FETCH-LOGICAL-c354t-3d87563de8838af5014d87f0d616e3b58c93dd6db55be937f5d4be3671509e363
container_end_page 160
container_issue 1
container_start_page 137
container_title Industrial and corporate change
container_volume 31
creator Agostino, Mariarosaria
Scalera, Domenico
Succurro, Marianna
Trivieri, Francesco
description Abstract This paper investigates the effects of R&D and innovation activities of firms on the risk of bankruptcy. The analysis is carried out on data drawn from the EU-EFIGE Survey and Amadeus Database (Bureau Van Dijk) on European manufacturing firms over the years 2009–2014. The empirical evidence shows that default probability is increasing in R&D investments and decreasing in innovation and productivity of research, measured by the ratio of innovation revenues to R&D outlays. In addition, to disentangle the influence of different innovation strategies (product, process, and patenting), 16 different firm profiles are compared. Firms carrying out R&D, adopting process innovation, and filing for patents are found to show the lowest probability of default. Sensitivity checks indicate that research and innovation do not affect the risk of financial distress events short of default (such as reorganization or application for insolvency procedure). Our findings are robust to potential endogeneity and hence allow for causal inference about the relationship between research and innovation and corporate bankruptcy.
doi_str_mv 10.1093/icc/dtab057
format article
fullrecord <record><control><sourceid>oup_cross</sourceid><recordid>TN_cdi_crossref_primary_10_1093_icc_dtab057</recordid><sourceformat>XML</sourceformat><sourcesystem>PC</sourcesystem><oup_id>10.1093/icc/dtab057</oup_id><sourcerecordid>10.1093/icc/dtab057</sourcerecordid><originalsourceid>FETCH-LOGICAL-c354t-3d87563de8838af5014d87f0d616e3b58c93dd6db55be937f5d4be3671509e363</originalsourceid><addsrcrecordid>eNp9kMtKw0AYRgdRMFZXvsCs3NjYf5xLEndS6gUKiug6zFVHzUyYSQp9-0batasDH4dvcRC6JHBDoKELr_XCDFIBr45QQZhgJRUcjlEBjYBSsIacorOcvwHgFqq6QK9vNluZ9Ncc-xDiRg4-hjmWwWAlw08a-0Fv77DdeGODttil2OHVmGJvZcCdDKOTehiTD5_Y-dTlc3Ti5G-2FwfO0MfD6n35VK5fHp-X9-tSU86Gkpq64oIaW9e0lo4DYdPiwAgiLFW81g01RhjFubINrRw3TFkqKsKhmUhn6Hr_q1PMOVnX9sl3Mm1bAu1fjHaK0R5iTPbV3o5j_6-4AyCHYVY</addsrcrecordid><sourcetype>Aggregation Database</sourcetype><iscdi>true</iscdi><recordtype>article</recordtype></control><display><type>article</type><title>Research, innovation, and bankruptcy: evidence from European manufacturing firms</title><source>EBSCOhost Business Source Ultimate</source><source>EBSCOhost Econlit with Full Text</source><source>Oxford Journals Online</source><creator>Agostino, Mariarosaria ; Scalera, Domenico ; Succurro, Marianna ; Trivieri, Francesco</creator><creatorcontrib>Agostino, Mariarosaria ; Scalera, Domenico ; Succurro, Marianna ; Trivieri, Francesco</creatorcontrib><description>Abstract This paper investigates the effects of R&amp;D and innovation activities of firms on the risk of bankruptcy. The analysis is carried out on data drawn from the EU-EFIGE Survey and Amadeus Database (Bureau Van Dijk) on European manufacturing firms over the years 2009–2014. The empirical evidence shows that default probability is increasing in R&amp;D investments and decreasing in innovation and productivity of research, measured by the ratio of innovation revenues to R&amp;D outlays. In addition, to disentangle the influence of different innovation strategies (product, process, and patenting), 16 different firm profiles are compared. Firms carrying out R&amp;D, adopting process innovation, and filing for patents are found to show the lowest probability of default. Sensitivity checks indicate that research and innovation do not affect the risk of financial distress events short of default (such as reorganization or application for insolvency procedure). Our findings are robust to potential endogeneity and hence allow for causal inference about the relationship between research and innovation and corporate bankruptcy.</description><identifier>ISSN: 0960-6491</identifier><identifier>EISSN: 1464-3650</identifier><identifier>DOI: 10.1093/icc/dtab057</identifier><language>eng</language><publisher>UK: Oxford University Press</publisher><ispartof>Industrial and corporate change, 2022-01, Vol.31 (1), p.137-160</ispartof><rights>The Author(s) 2021. Published by Oxford University Press in association with Oxford University Press and the Industrial and Corporate Change Association. All rights reserved. For permissions, please e-mail: journals.permissions@oup.com 2021</rights><lds50>peer_reviewed</lds50><woscitedreferencessubscribed>false</woscitedreferencessubscribed><citedby>FETCH-LOGICAL-c354t-3d87563de8838af5014d87f0d616e3b58c93dd6db55be937f5d4be3671509e363</citedby><cites>FETCH-LOGICAL-c354t-3d87563de8838af5014d87f0d616e3b58c93dd6db55be937f5d4be3671509e363</cites></display><links><openurl>$$Topenurl_article</openurl><openurlfulltext>$$Topenurlfull_article</openurlfulltext><thumbnail>$$Tsyndetics_thumb_exl</thumbnail><link.rule.ids>314,777,781,27905,27906</link.rule.ids></links><search><creatorcontrib>Agostino, Mariarosaria</creatorcontrib><creatorcontrib>Scalera, Domenico</creatorcontrib><creatorcontrib>Succurro, Marianna</creatorcontrib><creatorcontrib>Trivieri, Francesco</creatorcontrib><title>Research, innovation, and bankruptcy: evidence from European manufacturing firms</title><title>Industrial and corporate change</title><description>Abstract This paper investigates the effects of R&amp;D and innovation activities of firms on the risk of bankruptcy. The analysis is carried out on data drawn from the EU-EFIGE Survey and Amadeus Database (Bureau Van Dijk) on European manufacturing firms over the years 2009–2014. The empirical evidence shows that default probability is increasing in R&amp;D investments and decreasing in innovation and productivity of research, measured by the ratio of innovation revenues to R&amp;D outlays. In addition, to disentangle the influence of different innovation strategies (product, process, and patenting), 16 different firm profiles are compared. Firms carrying out R&amp;D, adopting process innovation, and filing for patents are found to show the lowest probability of default. Sensitivity checks indicate that research and innovation do not affect the risk of financial distress events short of default (such as reorganization or application for insolvency procedure). Our findings are robust to potential endogeneity and hence allow for causal inference about the relationship between research and innovation and corporate bankruptcy.</description><issn>0960-6491</issn><issn>1464-3650</issn><fulltext>true</fulltext><rsrctype>article</rsrctype><creationdate>2022</creationdate><recordtype>article</recordtype><recordid>eNp9kMtKw0AYRgdRMFZXvsCs3NjYf5xLEndS6gUKiug6zFVHzUyYSQp9-0batasDH4dvcRC6JHBDoKELr_XCDFIBr45QQZhgJRUcjlEBjYBSsIacorOcvwHgFqq6QK9vNluZ9Ncc-xDiRg4-hjmWwWAlw08a-0Fv77DdeGODttil2OHVmGJvZcCdDKOTehiTD5_Y-dTlc3Ti5G-2FwfO0MfD6n35VK5fHp-X9-tSU86Gkpq64oIaW9e0lo4DYdPiwAgiLFW81g01RhjFubINrRw3TFkqKsKhmUhn6Hr_q1PMOVnX9sl3Mm1bAu1fjHaK0R5iTPbV3o5j_6-4AyCHYVY</recordid><startdate>20220101</startdate><enddate>20220101</enddate><creator>Agostino, Mariarosaria</creator><creator>Scalera, Domenico</creator><creator>Succurro, Marianna</creator><creator>Trivieri, Francesco</creator><general>Oxford University Press</general><scope>AAYXX</scope><scope>CITATION</scope></search><sort><creationdate>20220101</creationdate><title>Research, innovation, and bankruptcy: evidence from European manufacturing firms</title><author>Agostino, Mariarosaria ; Scalera, Domenico ; Succurro, Marianna ; Trivieri, Francesco</author></sort><facets><frbrtype>5</frbrtype><frbrgroupid>cdi_FETCH-LOGICAL-c354t-3d87563de8838af5014d87f0d616e3b58c93dd6db55be937f5d4be3671509e363</frbrgroupid><rsrctype>articles</rsrctype><prefilter>articles</prefilter><language>eng</language><creationdate>2022</creationdate><toplevel>peer_reviewed</toplevel><toplevel>online_resources</toplevel><creatorcontrib>Agostino, Mariarosaria</creatorcontrib><creatorcontrib>Scalera, Domenico</creatorcontrib><creatorcontrib>Succurro, Marianna</creatorcontrib><creatorcontrib>Trivieri, Francesco</creatorcontrib><collection>CrossRef</collection><jtitle>Industrial and corporate change</jtitle></facets><delivery><delcategory>Remote Search Resource</delcategory><fulltext>fulltext</fulltext></delivery><addata><au>Agostino, Mariarosaria</au><au>Scalera, Domenico</au><au>Succurro, Marianna</au><au>Trivieri, Francesco</au><format>journal</format><genre>article</genre><ristype>JOUR</ristype><atitle>Research, innovation, and bankruptcy: evidence from European manufacturing firms</atitle><jtitle>Industrial and corporate change</jtitle><date>2022-01-01</date><risdate>2022</risdate><volume>31</volume><issue>1</issue><spage>137</spage><epage>160</epage><pages>137-160</pages><issn>0960-6491</issn><eissn>1464-3650</eissn><abstract>Abstract This paper investigates the effects of R&amp;D and innovation activities of firms on the risk of bankruptcy. The analysis is carried out on data drawn from the EU-EFIGE Survey and Amadeus Database (Bureau Van Dijk) on European manufacturing firms over the years 2009–2014. The empirical evidence shows that default probability is increasing in R&amp;D investments and decreasing in innovation and productivity of research, measured by the ratio of innovation revenues to R&amp;D outlays. In addition, to disentangle the influence of different innovation strategies (product, process, and patenting), 16 different firm profiles are compared. Firms carrying out R&amp;D, adopting process innovation, and filing for patents are found to show the lowest probability of default. Sensitivity checks indicate that research and innovation do not affect the risk of financial distress events short of default (such as reorganization or application for insolvency procedure). Our findings are robust to potential endogeneity and hence allow for causal inference about the relationship between research and innovation and corporate bankruptcy.</abstract><cop>UK</cop><pub>Oxford University Press</pub><doi>10.1093/icc/dtab057</doi><tpages>24</tpages></addata></record>
fulltext fulltext
identifier ISSN: 0960-6491
ispartof Industrial and corporate change, 2022-01, Vol.31 (1), p.137-160
issn 0960-6491
1464-3650
language eng
recordid cdi_crossref_primary_10_1093_icc_dtab057
source EBSCOhost Business Source Ultimate; EBSCOhost Econlit with Full Text; Oxford Journals Online
title Research, innovation, and bankruptcy: evidence from European manufacturing firms
url http://sfxeu10.hosted.exlibrisgroup.com/loughborough?ctx_ver=Z39.88-2004&ctx_enc=info:ofi/enc:UTF-8&ctx_tim=2025-01-20T20%3A24%3A00IST&url_ver=Z39.88-2004&url_ctx_fmt=infofi/fmt:kev:mtx:ctx&rfr_id=info:sid/primo.exlibrisgroup.com:primo3-Article-oup_cross&rft_val_fmt=info:ofi/fmt:kev:mtx:journal&rft.genre=article&rft.atitle=Research,%20innovation,%20and%20bankruptcy:%20evidence%20from%20European%20manufacturing%20firms&rft.jtitle=Industrial%20and%20corporate%20change&rft.au=Agostino,%20Mariarosaria&rft.date=2022-01-01&rft.volume=31&rft.issue=1&rft.spage=137&rft.epage=160&rft.pages=137-160&rft.issn=0960-6491&rft.eissn=1464-3650&rft_id=info:doi/10.1093/icc/dtab057&rft_dat=%3Coup_cross%3E10.1093/icc/dtab057%3C/oup_cross%3E%3Cgrp_id%3Ecdi_FETCH-LOGICAL-c354t-3d87563de8838af5014d87f0d616e3b58c93dd6db55be937f5d4be3671509e363%3C/grp_id%3E%3Coa%3E%3C/oa%3E%3Curl%3E%3C/url%3E&rft_id=info:oai/&rft_id=info:pmid/&rft_oup_id=10.1093/icc/dtab057&rfr_iscdi=true