The Impact of R&D Investments on Corporate Performance in European Countries

ABSTRACT :In our article we analyze the determinants of investment in research and development inEuropean industries. Data are collected from the Economics ofIndustrial Research & Innovation ofEuropeanCommission for 23 countries in the period between 2003 and 2019. We apply panel data with fixedand random effects to estimate the impact of the research and development investment on the performance ofthe firm. We found that the investment in research and development is associated to an increase in net sales andthe number of employees and to a decrease in the level of market capitalization and capital expenditures.