This study presents a novel empirical approach to identify financing constraints for innovation based on the concept of an ideal test (Hall, 2008). Firms were offered a hypothetical payment and asked to choose between alternatives of use. If they selected additional innovation projects, they...

This study presents a novel empirical approach to identify financing constraints for innovation based on the concept of an ideal test (Hall 2008). Firms were offered a hypothetical payment and were asked to choose between alternatives of use. If they selected additional innovation projects, they...

Using firm-level data from the German manufacturing sector, we estimate a dynamic, structural model of the firm's decision to invest in R&D and quantify the cost and longrun benefit of this investment. The model incorporates and quantifies linkages between the firm's R&D investment, product and...

This paper investigates empirically rm investment behavior in research and development (R&D). Firms make investments in R&D in order to produce innovations. These innovations in turn improve the rm s future productivity level, pro tability and incentives to invest in R&D. Using German rm-level...

Using a recently developed model which allows to separate a few well- established employment effects of product and process innovations, this paper reports new results on the relationship between innovation and employment growth in Germany. The model is tailor-made for analysing firm-level...