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Technology spillovers, asset redeployability and corporate financial policies
Author(s) -
Kecskés Ambrus,
Nguyen PhuongAnh
Publication year - 2021
Publication title -
european financial management
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.311
H-Index - 64
eISSN - 1468-036X
pISSN - 1354-7798
DOI - 10.1111/eufm.12324
Subject(s) - leverage (statistics) , collateralized debt obligation , asset (computer security) , business , productivity , monetary economics , enterprise value , financial innovation , economics , finance , computer security , collateral , machine learning , computer science , macroeconomics
Prior research shows that technology spillovers across firms increase innovation, productivity and value. We study how firms finance their own growth stimulated by technology spillovers from their technological peer firms. We find that greater technology spillovers lead to higher leverage. This is the result of technology spillovers increasing asset redeployability, as evidenced by more collateralized borrowing and asset transactions. Borrowing costs also decrease. Exogenous variation in the research and development tax credits of other firms allows us to identify the causal effect of technology spillovers on a given firm.