This paper investigates the effect of R&D intensity on firm resilience during the COVID-19 recession. I use firm-level data on European technology firms to identify the relation between R&D intensity and resilience, where firm resilience is measured through financial flexibility and firm performance. To investigate deeper into firm performance I distinguish between performance using accounting measures and market performance. I find that R&D intensity has a positive effect on resilience as viewed from accounting measures. I find mixed results regarding performance: No significant positive evidence between R&D intensity and stock performance is found, whereas evidence suggesting a significant non-linear relationship between R&D intensity and return on assets is found. Nevertheless, the results indicate that there seem to be some positive effect of R&D on firm resilience. This is of value to policymakers and corporate managers aiming to enhance firm resilience through strategic R&D investments. Further research with more detailed data are needed to explore the mechanisms behind this relationship.
| Identifer | oai:union.ndltd.org:UPSALLA1/oai:DiVA.org:uu-532711 |
| Date | January 2024 |
| Creators | Lybæk, Vegard Ranum |
| Publisher | Uppsala universitet, Nationalekonomiska institutionen |
| Source Sets | DiVA Archive at Upsalla University |
| Language | English |
| Detected Language | English |
| Type | Student thesis, info:eu-repo/semantics/bachelorThesis, text |
| Format | application/pdf |
| Rights | info:eu-repo/semantics/openAccess |
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