R&D Activities and their Impact on Firm Growth in Austria

An increase of investment in research and development leads to a higher firm growth rate in subsequent years. Between 1995 and 2006, a 10 percent rise in R&D intensity accelerated employment growth by 0.6 to 1.8 percentage points per year, depending on the period observed and on a ceteris paribus basis, although the effect decreased in recent years. However, the growth effect generated by R&D activities varies considerably between firms and is strongest among expanding companies.