Corporate Governance and Its Impact on R&D Investment in Emerging Markets

Marc Steffen Rapp, Iuliia A. Udoieva

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    Corporate R&D activities are inherently risky but also difficult to monitor. Against this background, we examine the impact of ownership concentration and legal shareholder rights protection on corporate R&D investments in emerging markets. Based on a comprehensive sample of publicly listed firms from 24 countries, we find that R&D intensity is lower in firms with (strategic) block ownership, and this effect is more pronounced in countries with stronger shareholder rights protection. This suggests that, similar to the situation in developed economies, dispersed ownership, which allows shareholders to diversify their investment risks, is beneficial for corporate R&D and that this effect is intensified by more developed institutions.
    Original languageEnglish
    JournalEmerging Markets Finance & Trade
    Issue number10
    Pages (from-to)2159-2178
    Number of pages20
    Publication statusPublished - 2017

    Bibliographical note

    Published online: 17. October 2016


    • Emerging markets
    • Ownership
    • R&D investment
    • Shareholder rights protection

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