The effects of R&amp;D intensity and internationalization on the performance of non-high-tech SMEs

Booltink, Lucas Wa; Saka‐Helmhout, Ayse

doi:10.1177/0266242617707566

Cited by 72 publications

(77 citation statements)

References 116 publications

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“…This allows the analysis of two, three, or more variables as factors depend on each other while allowing the measurement of some constructs by some other indicators (e.g., the 8 individual items/factors). The latter aspect is common in SME research (Booltink & Saka‐Helmhout, ; Dar & Mishra, ), whereas the former is not.…”

Section: Methodsmentioning

confidence: 99%

Using the “best‐fit” approach to investigate the effects of politico‐economic and social barriers on SMEs' internationalization in an emerging country context: Implications and future directions

Mendy

Rahman

Bal

2020

Thunderbird Intl Bus Rev

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The way this study has used the "best-fit" approach has facilitated the investigation of how three hypothesized constructs of political, economic, and social barriers can deepen our knowledge of their impacts on small and medium-sized enterprises (SMEs)' internationalization within a small developing country context. Based on a quantitative analysis of the three hypothesized barriers, we used the "best-fit" approach to measure the extent to which the SMEs' internal variables like people, products, services, and practices might best fit some of the people and non-people factors external to the businesses. The application of the "best-fit" approach onto the three hypotheses-politics (H1), social (H2), economics (H3), helped us in explaining the major social and politico-economic barriers faced by a developing economy' (Bangladeshi) SMEs' internationalization despite previous literatures' emphasis on the impacts of globalization, market drivers or their oversight. Based on the findings, we point to future research trajectory. This study used primary survey data from 212 Bangladeshi SMEs and successfully validated an HR model by using Smart PLS3 software. The results from the hypotheses were used to produce the HR model to help SMEs identify the significance of people and economic factors and propose these aspects for inclusion in the "best-fit" approach, SME, and globalization research. K E Y W O R D Sbest-fit approach, developing country, HR model, internationalization, SMEs

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Section: Methodsmentioning

confidence: 99%

Using the “best‐fit” approach to investigate the effects of politico‐economic and social barriers on SMEs' internationalization in an emerging country context: Implications and future directions

Mendy

Rahman

Bal

2020

Thunderbird Intl Bus Rev

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“…R&D intensity is considered a measure of innovation by using R&D expenditures, which are authentic expenses of investigated items in a firm's R&D activities, including direct expenses in R&D activities and the indirect expenses of service and management in R&D activities . R&D intensity is the ratio of R&D expenses divided by total sales (Booltink & Saka-Helmhout, 2017). All independent variables are lagged by 1 year (dependent variable t + 1) to avoid possible endogeneity issues and to draw better implications.…”

Section: Independent Variablementioning

confidence: 99%

Intangible Assets Investment and Firms’ Performance: Evidence From Small and Medium-Sized Enterprises in Korea

Seo

Kim

2020

Journal of Business Economics and Management

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While many studies have examined the relationship between investment in intangibles assets and performance in large corporations, current research is lacking in regard to intangible investments in small and medium enterprises (SMEs). This study looks at SMEs in which intangible investments would usually be minor because they tend to consider intangible investment as an inefficient cost and concentrate on investments in tangible assets. This paper aims to contribute to the current literature and suggests that investment in the intangible assets of (human capital, advertising, R&D) is essential for SMEs pursuing superior firm performance. Actual data collected from 173 SMEs in Korea were analyzed employing hierarchical regression methodology. Results indicate that all three intangible resources have a positive effect on a firm's profitability and value. Interestingly, this research finds that investment in advertising has the most influential impact on a firm's profitability and value. This study has implications for SMEs in achieving their profitability and value. The results in this study highlight that intangible investment is not a waste of money for SMEs, and that business managers could strategically utilize these three key contributors (human capital, advertising, R&D) and adopt investment in intangible assets to accomplish their managerial goals.

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“…On the other hand, prior literature shows that R&D investments have a non-linear relationship with firm performance [8,[10][11][12]. Using a sample of the U.S. manufacturing firms, Bae et al [8] document that the relationship between R&D investments and firm performance in multinational firms is not monotonic, but the relationship varies with the phase of firms' multinationality.…”

Section: Literature Review and Hypothesis Developmentmentioning

confidence: 99%

“…They show that R&D intensity is non-linearly associated with market value of the firm. Booltink and Saka-Helmhout [12] examine the relationship between R&D intensity and firm performance using a sample of non-high-tech small and medium-sized enterprises (SMEs). They find that there is an inverted U-shaped relationship between R&D intensity and firm performance.…”

Section: Literature Review and Hypothesis Developmentmentioning

confidence: 99%

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R&D Investments and Firm Value: Evidence from China

et al. 2018

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This study examines whether R&D investments are non-linearly related to firm value. Using a sample of 563 Chinese listed firms between 2005 and 2013, we find that R&D investments have an inverted U-shaped relationship with firm value. This finding indicates that as R&D investments increase, firm value increases to a certain level and then decreases. We further find the presence of an inverted U-shaped relationship in firms with low state ownership. However, we find no evidence of a non-linear relationship in firms with high state ownership. These results suggest that the inverted U-shaped relationship is more pronounced for firms with low state ownership than for firms with high state ownership. Moreover, we find that there is an inverted U-shaped relationship between R&D investments and firm value in firms with high growth opportunities. In contrast, for firms with low growth opportunities, their relationship has a U-shaped pattern. These results are robust to robust standard errors clustered at the firm level, controlling for industry fixed effects, and omitting variable biases. Overall, our empirical evidence extends and complements the literature on the R&D investments-firm value relationship by considering their non-linear pattern. This study provides important implications for stakeholders, such as investors, policy makers, standard-setters, state owners, and regulators. Specifically, our findings can be useful to policy makers who pursue long-term performance objectives.Sustainability 2018, 10, 4133 2 of 17 the growth of new industries. China's total spending on research and development is estimated to have been 1.76 trillion yuan (around $279 billion) in 2017 [13]. R&D growth in Chinese firms had led the global market in its scale and scope by capitalizing their advantages in competitive costs to promote innovation and reap the technological capabilities for success in the world market [14]. Second, in China, both state-owned enterprises (SOEs) and private firms coexist. In particular, SOEs account for a substantial proportion of China's economy and their political connection with the Chinese government likely facilitate investment financing [15,16], enabling them to invest in more R&D. Similarly, Wu [17] points out that SOEs are likely to engage in more R&D investments.We test a non-linear relationship between R&D investments and firm value using a sample of 563 Chinese listed firms between 2005 and 2013. In our analyses, we employ three estimation specifications, such as pooled ordinary least squares (OLS) regressions, fixed-effect panel regressions, and dynamic panel generalized method of moments (GMM) estimators. We find that R&D investments have an inverted U-shaped relationship with firm value. As an additional analysis, we also examined the association between R&D investments and firm value in terms of high and low state ownership. We find that there is an inverted U-shaped pattern between R&D investments and firm value in firms with low state ownership. However, we find no evidence of a non-linear...

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The effects of R&D intensity and internationalization on the performance of non-high-tech SMEs

Cited by 72 publications

References 116 publications

Using the “best‐fit” approach to investigate the effects of politico‐economic and social barriers on SMEs' internationalization in an emerging country context: Implications and future directions

Using the “best‐fit” approach to investigate the effects of politico‐economic and social barriers on SMEs' internationalization in an emerging country context: Implications and future directions

Intangible Assets Investment and Firms’ Performance: Evidence From Small and Medium-Sized Enterprises in Korea

R&D Investments and Firm Value: Evidence from China

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