Property Rights Protection and Corporate R&D: Evidence from China
43 Pages Posted: 9 May 2009
Date Written: May 9, 2009
Abstract
Following the recent literature on institutions and economic growth, we examine the effects of property rights protection on corporate R&D. Using a unique 2003 World Bank survey of over 2400 firms in 18 Chinese cities, we obtain the following findings: (1) property rights protection is positively and significantly related to corporate R&D activity (for both process and product R&D); (2) government services and helping hand are conducive to corporate R&D, while informal payments to government officials are not; and (3) government ownership of firms and direct appointment of CEOs are negatively associated with corporate R&D activities. We also find that corporate R&D is positively related to firm size, and access to finance, but negatively related to product market competition and firm age.
Keywords: Property Rights Protection, Government Grabbing Hand, Corporate R&D
JEL Classification: O3, O12, P20
Suggested Citation: Suggested Citation
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