Firm Productivity, Innovation and Financial Development
By Geneviève Verdier, Erasmus Kersting, Era Dabla‐Norris. Social Science Research Network, 2010
114 citations recorded by the source corpus.
How do firm-specific actions-in particular, innovation-affect firm productivity? And what is the role of the financial sector in facilitating higher productivity? Using a rich firm-level dataset, we find that innovation is crucial for firm performance as it directly and measurably increases productivity. Moreover, its effects on productivity are mediated through the financial sector; firms reap the maximum benefits from innovation in countries with well-developed financial sectors. This effect is particularly important for firms in high-tech sectors, which typically have higher external financing needs.
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Citations in the corpus
- Revisiting the finance-innovation nexus: Evidence from a non-linear approach (2017, unknown): “Using the data from the Morocco census of manufacturing enterprises and information from a commune survey, Fafchamps and Schundeln (2013) find that local bank availability is statistically significant determinant of small and medium-size firms’ growth, lower likelihood of firm exit and a higher like”
- Innovation across Europe: how important are institutional differences? (2011, background): “Specifically, access to credit can be more critical in high-technology industries, which typically have higher external financing needs (Dabla-Norris et al., 2010).”