R&D in Indian public enterprises: An assessment

Using data on a large sample of public companies in India for 1987-2005, the findings indicate that increases in firm size are likely to be associated with increase in R&D up to a threshold. The evidence is also supportive of the fact that both the intensity of R&D as well as innovation activity is lower for leveraged firms. Finally, the findings fail to discern any significant improvement in R&D intensity in the post-reform period; although there is a noticeable decline in innovation activity after reforms. Privatization does not seem to have exerted any perceptible influence on R&D behaviour of public firms