Score contribution per author:
α: calibrated so average coauthorship-adjusted count equals average raw count
We provide new empirical evidence of the relationship between the availability of internal funds and firms’ investment. By employing a semi-parametric fixed effect model, we estimate a U-shaped curve relating investment and internal funds. Our results highlight the importance of allowing for nonlinearities when modeling changes in internal funds and investment, and show that R&D expenses play a critical role on firms’ investment under financial constraints