R&D, capital structure and ownership concentration: evidence from Italian microdata

The purpose of the article is to provide some evidence on the interconnection between capital structure, R&D investment and ownership concentration using a unique panel data-set of Italian firms. We study the effect of R&D intensity on leverage for two groups of firms which are different in terms of their degree of ownership concentration. Our results suggest for Public Limited Companies, a nonlinear relationship between R&D intensity and leverage, with the latter first increasing and then decreasing. Interestingly, the same result is not found to hold true for Private Limited Companies, which are characterized by a more concentrated ownership.