Author:
Chen Langzi,Chen Zhihong,Li Jian
Abstract
Due to the long-term nature and information asymmetry, SMEs (Small and Medium Enterprises) experience serious financial constraints that affect their R&D investments. This article examines the effect of trade credit maintaining sustainable R&D investment of SMEs under financial constraints. Using the panel data of Chinese SMEs from 2002–2014, it was found that although the R&D investments of SMEs are restricted by financial constraints, trade credit can maintain the sustainability of enterprises’ R&D investment. Private enterprises are more reliant on trade credit, which can be intensified during periods of monetary tightening. Considering the counterfactual framework and the endogenous problems, the empirical results were also robust when using propensity score matching. To summarize, this article develops a new explanation for maintaining sustainable R&D investment of SMEs under financial constraints in developing countries.
Funder
National Natural Science Foundation of China
Department of Education, Jiangsu Province
Subject
Management, Monitoring, Policy and Law,Renewable Energy, Sustainability and the Environment,Geography, Planning and Development
Cited by
7 articles.
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