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Subsidies, financial constraints and firm innovative activities in emerging economies

Mateut, Simona



This paper investigates the relationship between public subsidies and firm innovation in emerging economies, which are likely to have less developed financial markets. Innovation includes the introduction of new products or services and the upgrade of existing ones, which is of particular relevance for these economies. The results obtained using alternative measures of financial constraints and market competition, within a range of econometric techniques, suggest a positive relation between public subsidies and the innovative activities of 11,998 firms across thirty Eastern Europe and Central Asia countries. This correlation is stronger for firms more likely to be financially constrained.


Mateut, S. (in press). Subsidies, financial constraints and firm innovative activities in emerging economies. Small Business Economics, 50(1),

Journal Article Type Article
Acceptance Date May 1, 2017
Online Publication Date Jun 16, 2017
Deposit Date May 4, 2017
Publicly Available Date Jun 16, 2017
Journal Small Business Economics
Print ISSN 0921-898X
Electronic ISSN 1573-0913
Publisher Springer Verlag
Peer Reviewed Peer Reviewed
Volume 50
Issue 1
Keywords Innovation, Subsidies, Financial constraints, Emerging countries
Public URL
Publisher URL


10.1007_s11187-017-9877-3.pdf (839 Kb)

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