Innovation activity and corporate financing: evidence from a developing economy

$54.97 plus tax (Refund Policy)

Buy Article:

Abstract:

The present study investigates the extent to which technology-related asymmetric information between corporate managers and outside investors has an adverse effect on the external financing activities of innovation-intensive firms. The results indicate that innovation-intensive firms are more likely to engage in equity financing when their valuation multiples are higher than those of their industry peers. This finding is more pronounced among firms with low institutional shareholdings and fewer brokers following them. The empirical evidence supports the misvaluation explanation, as well as the timing and type of security issuance if the agency problem is severe. The findings provide insights into the timing of company financing choices in a highly innovative developing economy.

Keywords: M21; M40; N25; capital markets; external financing; innovation activity; patents

Document Type: Research Article

DOI: http://dx.doi.org/10.1080/09603107.2012.667547

Affiliations: Department of Accounting,National Chengchi University, 64, Sec. 2 Zhi-Nan RoadTaipei 11605, Taiwan

Publication date: October 1, 2012

More about this publication?
Related content

Share Content

Access Key

Free Content
Free content
New Content
New content
Open Access Content
Open access content
Subscribed Content
Subscribed content
Free Trial Content
Free trial content
Cookie Policy
X
Cookie Policy
ingentaconnect website makes use of cookies so as to keep track of data that you have filled in. I am Happy with this Find out more