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AbstractOne of the key factors for the development and stability of countries' economies is the creation of a suitable financing system for companies. The financing system of the companies should be updated and optimized should provide an appropriate response in face of various opportunities and threats. In the last decade, companies in the country faced two major crises, the intensification of sanctions and Covid-19, which seems to have had a profound effect on their financing. In this regard, the present study identified the dimensions affecting the development of the financing system of companies by comprehensively studying the research literature and then experimentally tested the proposed model under the influence of sanctions and covid-19 using the structural equation method. In other words, this study sought to answer the challenge of how the effectiveness of the financing model is influenced by the sanctions and covid-19.For this purpose, the data of 159 companies during the years 2013 to 2022 (1590 companies-years) were compiled to examine 14 hypotheses and were tested using the structural equation method using SmartPLS4 software in the form of three separate models.The financing model was divided into three parts: internal, short-term external and long-term external.The results of the research showed that the sanctions and covid-19 crisis have an effect on audit characteristics, financial performance, market performance, investment efficiency, political Communication on internal financing through retained earnings, as well as the effect of financial performance, market performance, investment efficiency, political Communication and Corporate characteristics significantly reduce short-term and long-term external financing and increase the impact of economic uncertainty on internal financing through retained earnings and short-term and long-term external financing.Finally, based on the determination coefficients of all three research models, it was determined that the selected structures have more explanatory power for long-term financing than internal financing and short-term financing.

Scholars propose that global financial integration can boost foreign investment, technology transfer, and economic development, yet it presents challenges like inflation & financial risks. This study explores factors such as FDI, ODA, foreign assets, and external debt, shaping a country’s economic growth. Focused on Bangladesh, it employs the ARDL approach for connecting financial integration and economic growth. Findings show significant impacts, with ODA & foreign assets benefiting while external debt & FDI have negative effects. These insights aid policy formulation to optimize foreign capital inflows and mitigate adverse consequences, fostering economic growth, unveiling the relationship between financial openness and development.

The trend of alternative farmers adopting conventional farming methods, known as conventionalization, has become increasingly prevalent. External investment can be a catalyst for the conventionalization of alternative agriculture. The study seeks to examine the dynamics through which external investment and investors facilitate the conventionalization of alternative agriculture. A study was conducted on a Sharing Community Supported-Agriculture (CSA) Farm, with data being gathered through semi-structured interviews and analyzed using thematic methods. The findings indicated that (1) the low economic sustainability of Sharing CSA Farm leads to an influx of external investment; (2) external investors compel the farm manager to relax adherence to the ecological values and principles of organic agriculture and shift towards specialized and intensive farming in order to make the farms profitable; (3) a new business model for Sharing CSA Farm is adopted to further support the conventionalization. This study can provide new implications for improving the economic sustainability of alternative agriculture. [ABSTRACT FROM AUTHOR]

The financial performance policy of a firm determines what proportion of earnings is paid to shareholders by the way of financial decisions and what proportion is ploughed back in the firm for reinvestment purposes. If a firm's capital budgeting decision is independent of its financial performance of its financial performance policy, a higher financial performance payment will entail a greater dependence on external financing. On the other hand, if a firm's capital budgeting decision is dependent on its financial performance decision, a higher payment will cause shrinkage of its capital budget and vice versa. In such a case the financial performance policy has a bearing on the capital budgeting decision. [ABSTRACT FROM AUTHOR]

Background: Infectious disease outbreaks like Ebola and Covid-19 are increasing in frequency. They may harm reproductive, maternal and newborn health (RMNH) directly and indirectly. Sierra Leone experienced a sharp deterioration of RMNH during the 2014–16 Ebola epidemic. One possible explanation is that donor funding may have been diverted away from RMNH to the Ebola response. Methods: We analysed donor-reported data from the Organisation for Economic Cooperation and Development (OECD)'s Creditor Reported System (CRS) data for Sierra Leone before, during and after the 2014–16 Ebola epidemic to understand whether aid flows for Ebola displaced aid for RMNH. We estimated aid for Ebola using key term searches and manual review of CRS records. We estimated aid for RMNH by applying the Muskoka-2 algorithm to the CRS and analysing CRS purpose codes. Results: We find substantial increases in aid to Sierra Leone (from $484 million in 2013 to $1 billion at the height of the epidemic in 2015), most of which was earmarked for the Ebola response. Overall, Ebola aid was additional to RMNH funding. RMNH aid was sustained during the epidemic (at $42 m per year) and peaked immediately after (at $77 m in 2016). There is some evidence of a small displacement of RMNH aid from the UK during the period when its Ebola funding increased. Conclusions: Modest changes to RMNH donor aid patterns are insufficient to explain the severe decline in RMNH indicators recorded during the outbreak. Our findings therefore suggest the need for substantial increases in routine aid to ensure that basic RMNH services and infrastructure are strong before an epidemic occurs, as well as increased aid for RMNH during epidemics like Ebola and Covid-19, if reproductive, maternal and newborn healthcare is to be maintained at pre-epidemic levels. [ABSTRACT FROM AUTHOR]

Subsidies from the government and financial resources from external investors play critical roles in supporting firm innovations. We develop a model to empirically investigate the role of firm innovation efficiency in government subsidy allocations and the joint effect of innovation efficiency and government subsidies on external investor decision-making in China. We collect panel data from 337 firms in China over ten years (2011–2021). The results show an inverted U-shaped relationship between innovation efficiency and government subsidies. Both government subsidies and innovation efficiency are positively associated with external financing. Government subsidies positively moderate the impact of innovation efficiency on external financing. The findings provide empirical evidence of the complex relationships among firm innovation efficiency, government subsidies and external financing. In this study, insights are provided into how Chinese government officials and external investors interpret signals of firm innovation. The findings of this study can also be used by managers to attract financial resources and by investors to make investment decisions. [ABSTRACT FROM AUTHOR]

We investigate changes in analysts' accrual-related forecast optimism after the disappearance of the accrual anomaly. We find that such optimism persists in the no-anomaly period, particularly when analysts' incentives are aligned with greater optimism (i.e., for firms with high external financing). By contrast, the accrual-related forecast optimism declines when analysts' incentives for optimism are low and in circumstances where analysts would have been more aware of accruals information after the anomaly became publicized (i.e., when analysts issued a cash flow forecast). These findings suggest that analysts' incentives can offset forecast improvements that their heightened accrual awareness would otherwise allow. They also highlight the importance of considering both analysts' incentives and knowledge when interpreting their forecasts. Data Availability: Data are available from sources identified in the text. JEL Classifications: G14; G29; M41. [ABSTRACT FROM AUTHOR]

Access to finance to stay competitive is a salient challenge for small and medium-sized enterprises (SMEs). Few studies examine how cultures (i.e. social norms and customs) in different countries influence various channels for SMEs' external financing (i.e. formal and informal). In particular, gender inequality, such as in terms of gender disparities in health, empowerment, and the labor market in each country, can bias lenders' perspectives of female SME owners. By incorporating pecking order, information cost, and lack-of-fit theories, this study uses the Global Entrepreneurship Monitor dataset and other secondary datasets to investigate the impact of culture and gender inequality on tourism and hospitality SME owners' access to formal and informal financing. The results show that cultures that are more masculine than feminine encourage both formal and informal financing; however, cultures with high power distance boost informal financing and hinder formal financing. In addition, gender inequality moderates these cultural influences on access to finance. This study contributes to the SME literature and provides insights for governments and policymakers. [ABSTRACT FROM AUTHOR]

This study investigated the effect of components of external financing on economic sustainability in Nigeria with a view to determine the effect and decide which options are most appropriate in the light of the fact that external financing is still relevant to augment a deficient capital base. The Autoregressive Distributed Lag (ARDL) model and Wald Test were employed on the data from 1999 Q1 to 2022 Q4. The bounds test revealed that there is a strong long run significant relationship between external financing and economic sustainability. Foreign direct investment, foreign portfolio investments and official development assistance are the sources that present feasible alternatives for Nigeria. Remittances and external loans have produced negative effects in the period under study. Thus, it is recommended that the impact of external financing on economic sustainability could be enhanced through improvements in the absorptive capacity of the economy and ensuring macroeconomic and socioeconomic stability. [ABSTRACT FROM AUTHOR]

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Purpose – This study aims to focus on the optimal green R&D of a capital-constrained supply chain under different channel power structures as well as the impact of capital constraint, financing cost, channel power structure and cost-reducing efficiency on green R&D and supply chain profitability. Design/methodology/approach – A two-echelon supply chain is considered. The upstream firm engages in green R&D but has capital constraints that can be overcome by external financing. Green R&D is beneficial to reduce production costs and increase consumer demand. Based on whether or not the upstream firm is capital constrained and dominates the supply chain, four models are developed. Findings – Capital constraints significantly lower green R&D and supply chain profitability. Transferring leadership from the upstream to the downstream firms leads to higher green R&D levels and downstream firm profitability, whereas the upstream firm's profitability is increased (decreased) if green R&D investment efficiency is high (low) enough. Greater financing costs reduce green R&D and downstream firm profitability; however, the upstream firm's profitability under the model in which it functions as the follower increases if the initial capital is sufficient. More importantly, empirical analysis based on practice data is used to verify the theoretical results reported above. Practical implications – This study reveals how upstream firms in supply chains decide green R&D decisions in situations with capital constraints, providing managers and governments with an understanding of the impact of capital constraint, channel power structure, financing cost and cost-reducing efficiency on supply chain green R&D and profitability. Originality/value – The major contributions are the exploration of supply chain green R&D by taking into consideration channel power structures and cost-reducing efficiency and the validation of theoretical results using practice data.

This paper aims to answer whether firms of different sizes and stock liquidities differ in the choice of external sources of financing in companies listed in CEE countries. To this end the net debt issuance is regressed on the financial deficit. In regressions Pecking Order Coefficients are allowed to vary across firms with different sizes and stock liquidities. The results indicate that companies with less liquid shares prefer issuing debt to cover financial deficits more than companies with more liquid shares. This implies that stock liquidity may substitute debt issuance in alleviating the adverse effects of information asymmetry, especially in relatively small companies. This is the first study in which the relationship between liquidity and debt-equity choice is considered solely from a pecking order theory point of view. Also this is the first study in which stock liquidity effects on capital structure are studied in the CEE countries. Research results may point to the advantages of increasing the liquidity of shares which may contribute to reducing information asymmetry and thus a better allocation of resources.

Abstract This study investigates the relationship between corporate governance, external financing, and earnings management in an emerging market. Using a sample of Vietnamese listed companies in the period of 2010–2020, the results indicate that corporate governance, which is measured by a principal component analysis (PCA) methodology, is a useful mechanism to control earnings management. However, when firms engage in external financing activities, corporate governance is not significantly associated with both accrual-based and real earnings management. In addition, the study also examines the role of corporate governance in moderating the effects of earnings management on firm value, and how it is encouraged by external financing needs. The study shows that while good corporate governance lessens the influence of earnings management on firm value, external financing needs only prompts earnings manipulation and have no effect on firm value, directly or indirectly. Therefore, the findings could provide implications for managers and regulators to enhance governance practice to alleviate firm devaluation caused by earnings management practice.

Purpose: This study aims to investigate the link between debt structure and future external financing and investment, existing empirical literature suggest various features of debt structure such as maturity structure, seniority and security profile might affect firms’ future financing and investment opportunities. However, literature is vague as to which way these characteristics of debt are actually related to observed financing and investment; this is partly due to the fact that the assumptions in theoretical predictions lack in terms of channels they consider relating to debt structure and future external financing and investment. This study investigates how debt structure is associated to financing and future growth opportunities in terms of fund raising, whether debt structure of oil and gas sector of Pakistan. Design/Methodology/Approach: Dynamic analysis were used to analyze the data Findings: The results provide interesting insights, as traditional positive relationship in between short-maturity of debt external financing has revealed negative relation, which is in conflict with existing literature from agency cost but supports the rollover risk. The sector might be better off if it opts out to equity financing, which will open up new investment avenues for future financing and investment. Interestingly secured-debt does not appear to be beneficial owing to differing leveraging patterns within the sector. Implications/Originality/Value: The paper provides new insights in terms of investment and financing patterns particularly in context of maturity structure of debt.

Copyright of Global Journal of Economics & Business is the property of Refaad for Studies, Research & Development and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

The paper investigates the capital structure of companies listed on the Bucharest Stock Exchange (BSE) from an organizational life cycle perspective, seen as a determinant of the decisions to finance operations and growth. For this purpose, the life cycle is measured according to the cash flows patterns. Motivated by the pecking-order theory (POT) and carried out on a sample of 59 companies in the period 2010-2020, the study uses a Least Squares Dummy Variable (LSDV) panel data model and shows that listed Romanian companies resort more to bank financing in the initial stages of their life cycle. As they reach the maturity and shake-out stages, companies reorient towards internal financial resources and equity issuance, which is in line with the POT. Furthermore, the age of companies has a rather weak effect on the financial leverage, and its effect diminishes as firms age. The results also confirm the importance of having a high level of tangible fixed assets as collateral for bank loans, but also the significant role of the industry and geographical positioning on the degree of external financing.

The COVID-19 pandemic, the health protection measures, and the policies meant to limit the economic effects of the disease have affected the world's economies on multiple levels, the international trade being one of the most seriously influenced domains. The paper aims to highlight the effects of the pandemic on Romania's current account, as well as some directions of action aimed at improving the external deficit of our country. The methodology used in the article joins the empirical analysis of statistical data and their interpretation, with the identification of causalities. The analysis shows that the uncertainty regarding the evolution of COVID-19 and the measures adopted by the authorities to stop the spread of the coronavirus affected negatively, especially in 2020, the current account, and its way of financing. The paper highlights some elements that can hamper the decrease of the external deficit in the future (the large needs of external financing in the coming years, the dependence of the economy on imports, the unfavourable structure of Romanian exports and imports), as well as some directions of action intended to support the improvement of the external deficit of our country, including supporting the recovery of the economy, reducing the budget deficit, improving the domestic offer, and the research and innovation activity, etc.

Copyright of TYB Akademi Dil Edebiyat & Sosyal Bilimler Dergisi is the property of Turkiye Yazarlar Birligi and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

The purpose of this study is to identify the factors affecting external financing of innovation in small and medium enterprises by in-depth study of the research background and provide a model for it. An in-depth study of 257 articles, books and dissertations from reputable internal and external sources, meta-synthesis method and MAXQDA 10.0 qualitative analysis software were used, and the results showed that external and internal factors affect the external financing of innovation of small and medium enterprises. In the category of intra-organizational factors, technical and structural factors, human and political, and in the category of extra-organizational factors, legal, political and infrastructural factors affect the external financing of innovation of small and medium enterprises. Finally, a model of the factors affecting the external financing of innovation was presented. The current results could be a beacon for small and medium sized companies in external financing of innovation.

Copyright of Journal of Small Business & Entrepreneurship is the property of Routledge and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

• Financing constraints positively affect digital transformation washing. • Digital transformation washing fails to alleviate external financing constraints. • Digital transformation washing leads firms to rely more on internal financing. This study investigates the drivers and consequences of digital transformation whitewashing (DTW) among Chinese manufacturing firms from 2010 to 2021. We find that financing constraints have a robust and significant positive impact on DTW, an effect that is more pronounced for firms located in provinces with lower marketization or operating in industries with lower levels of monopoly. Regarding economic consequences, our results indicate that DTW fails to alleviate external financing constraints, instead causing firms to increasingly rely on internal financing. [ABSTRACT FROM AUTHOR]

Using Chinese listed companies as the research setting, this study investigates the impact of climate risk on corporate precautionary cash holdings and further explores possible underlying channels. We first apply the text mining technique to construct the climate risk indicator. The regression results then show that climate risk has a significant and positive impact on corporate precautionary cash holdings. Such positive relationship is stronger for firms with small size and those located in central and eastern China. Further mechanism analysis indicates that risk taking and external financing play a mediating effect between climate risk and corporate precautionary cash holdings. Our findings have important practical implications for companies to make sustainability strategies against potential climate risks.

This paper investigates the effect of external financing on earnings management in Vietnam, a bank-dominated economy. Using a sample of 494 listed non-financial firms from 2009 to 2018, we find that external financing is positively related to earnings management, implying that firms have incentives to manage earnings raising external fund. Additionally, earnings are manipulated when firms conduct capital raising by issuing either equity or debt. However, compared to debt financing, earnings are managed more aggressively when firms are involved in equity financing activities. Finally, we extend the literature by showing that equity is especially destructive at high levels. These findings lend credence to the argument that firms issuing equity have stronger incentives to manage earnings than debt issuers and call for thorough monitoring and scrutiny of stakeholders towards this type of issuance.

The COVID-19 pandemic, the health protection measures, and the policies meant to limit the economic effects of the disease have affected the world's economies on multiple levels, the international trade being one of the most seriously influenced domains. The paper1 aims to highlight the effects of the pandemic on Romania's current account, as well as some directions of action aimed at improving the external deficit of our country. The methodology used in the article joins the empirical analysis of statistical data and their interpretation, with the identification of causalities. The analysis shows that the uncertainty regarding the evolution of COVID-19 and the measures adopted by the authorities to stop the spread of the coronavirus affected negatively, especially in 2020, the current account, and its way of financing. The paper highlights some elements that can hamper the decrease of the external deficit in the future (the large needs of external financing in the coming years, the dependence of the economy on imports, the unfavourable structure of Romanian exports and imports), as well as some directions of action intended to support the improvement of the external deficit of our country, including supporting the recovery of the economy, reducing the budget deficit, improving the domestic offer, and the research and innovation activity, etc. [ABSTRACT FROM AUTHOR]

The signaling literature has focused on government financial signaling, yet little attention has been paid to government nonfinancial signaling. This study develops a signaling model in which visits from government officials are viewed as nonfinancial signals to certify the legitimacy and competitive advantage of young technology-based firms, in turn positively influencing the external investors’ investment decisions. Analyzing manually collected data of 1888 listed entrepreneurial firms in technology-based industries in China from 2009 to 2016, we find that the signal strength of the visits (reflected as the rank of officials) improves such firms’ access to external financing, including equity and debt financing. This signaling effect is contingent upon a similar signal (such as political connection) and the signaling environment (such as institutional development). In this article, we find that the effect of the visits becomes weak for host firms with political connections and those located in institutionally developed regions. Overall, we contribute to the signaling theory literature by investigating government nonfinancial signaling, revealing that similar signals substitute each other, and incorporating the signaling environment into our signaling model. [ABSTRACT FROM AUTHOR]

As the main players in green technology innovation, enterprises need to be fully mobilized and to clearly identify the impact of different types of policies on green technology innovation. Taking 6 144 private enterprises as the research data, this article first ana⁃ lyzed the impact of environmental regulations on different types of green technology innovation, including green process innovation and green product innovation. Secondly, based on the external perspective, it empirically tested the moderating effect of external financing on the relationship between environmental regulations, green process innovation, and green products innovation. Thirdly, it empirically tested the moderating effect of corporate political embeddedness on the relationship between environmental regulations, green process innovation, and green product innovation from an internal perspective. Finally, it further tested the moderating effect of the combination of political embeddedness and external financing on the relationship between environmental regulations and different types of green technology innovation. The results showed that: ① Environmental regulations, corporate political embeddedness, and external financing had positive effects on green technology innovation, and the moderating effect on green process innovation was more significant. ② Corporate political embeddedness could positively moderate the impact of environmental regulations on green technology innovation, especially on green product innovation. ③ Corporate political embeddedness and external financing had a joint moderating effect on environmental regulations driven by green technology innovation, that is, under the conditions of high political embeddedness and low financing constraints, environmental regulations had the most effective impact on green process innovation and green product innovation. This study found that the green recovery of economy was inseparable from effective environmental regulations. Therefore, external financing constraints should be reduced as far as possible to meet the capital demand of green technology innovation. At the same time, we need to improve the political embeddedness of enterprises. The government should provide environmental regulations, guide the political embeddedness of enterprises, and reduce external financing constraints in a synchronous and orderly manner. [ABSTRACT FROM AUTHOR]

Using a cross‐country firm‐bank dataset, we examine how an unexpected increase in bank capital requirements by the European Banking Authority affects firms' financial choices. We find that the regulatory shock implies a reduction in the supply of bank credit, with US firms affected the most. Yet, US firms can tap into the public bond markets and secure credit lines from nonbank financial institutions. This has implications for their capital structure and their real outcomes. These results suggest that diversified domestic loan markets, in which banks and nonbank financial institutions lend to corporations, can help overcome reductions in cross‐border bank funding. [ABSTRACT FROM AUTHOR]

This article takes China's high-tech companies from 2010 to 2019 as a sample to explore the correlation between innovation investment and corporate performance and the moderating effect of external financing on innovation investment and corporate performance. The main research conclusions are as follows: (1) Investment in innovation has a positive impact on corporate performance. (2) Equity financing has a regulatory effect that is beneficial to both innovation input and corporate performance. (3) Debt financing has a negative regulatory impact on corporate performance and innovation input. The negative adjustment effects of debt financing from strong to weak are: bond financing, long-term borrowing, short-term borrowing, and commercial credit. [ABSTRACT FROM AUTHOR]

From the perspective of gender roles, this study uses social capital as the intermediary variable to study female entrepreneurs' willingness to choose external financing. We combine social and behavioral sciences and financing theory to explore interactions between gender roles, social capital, and willingness to choose external financing. We elaborate on the intermediary role of social capital between gender roles and external financing. We find differences in gender role types among female entrepreneurs that significantly impact their willingness to choose external financing. Further, the differences among gender role types of female entrepreneurs significantly impact their social capital, which in turn is a significant but not sole factor that mediates their willingness to choose external financing. [ABSTRACT FROM AUTHOR]

Employing a comprehensive measure of country-level corporate transparency, we document a positive relation between corporate transparency and externally financed firm growth. This relation is robust to controlling for variables related to the quality of a country's legal institutions and the overall level of financial development. We also show that the level of external financing in the form of long-term debt is higher among firms in countries with greater corporate transparency. Further cross-sectional tests reveal that the role of corporate transparency in firm growth and external financing is less pronounced among bank-oriented countries as compared to market-oriented countries. In sum, our evidence highlights the positive impact of corporate transparency on economic growth through its impact on firm access to low-cost external financing. [ABSTRACT FROM AUTHOR]

We examine corporate disclosure patterns according to changes in firm states during financial crises in Korea. Using panel data on Korean listed firms from 1995 to 2019, we first confirm that they transparently (opaquely) disclose information when the change in return on assets is positive (negative) during crises. Moreover, we check that these disclosure patterns increase debt financing but are ineffective for equity financing. Finally, for chaebols with internal capital markets, we find that internal capital receivers provide transparent (opaque) disclosure of negative (positive) changes in their states. By contrast, providers show the opposite patterns. (JEL G01, G30, M40) [ABSTRACT FROM AUTHOR]

The promotion of wind power is an important strategic measure to promote energy transformation and achieve carbon neutralization in China. Driven by a series of industrial policies, China's wind power industry is still faced with the dilemma of "large quantity yet poor quality". Therefore, the paper considers as research object the wind power industry policies issued by the government of China between 2008 and 2019, and evaluates their impact on the innovation quality of enterprises from the perspective of financing modes. The results show that different categories of industry innovation policies and their combination have an important positive influence on enterprise innovation quality. There are differences in the regulatory effects of different financing modes on wind power industrial policy and enterprise innovation quality: internal financing inhibits the effect of industrial policy on enterprise innovation quality, while external financing promotes the impact of industrial policy on enterprise innovation quality. Further analysis shows that different categories of innovation policies and their combinations have impacts on the innovation quality of both private and state-owned enterprises, and in many regions. Finally, based on the research results, there are recommendations for policy managers and micro enterprises to stimulate the innovation quality of wind power plants. • The paper evaluates wind power industry policies and their combination impact on the innovation quality of enterprises from the perspective of financing modes. • Different categories of wind power industry policies and their combinations have an important positive influence on enterprise innovation quality. • There are conspicuous differences in the regulatory effects of different financing modes on industry policy and enterprise innovation quality. • Different types of industry policies and their combinations have impacts on the innovation quality of both private and state-owned enterprises, and in many regions. • There are differences in the regulatory effects of different financing modes on industry policy and innovation quality of both private and state-owned enterprises, and in many regions. [ABSTRACT FROM AUTHOR]

This research investigates the significance of technological innovation for Thailand’s industrial development through equity participation in the form of foreign direct investment (FDI). The pecking order theory suggests that to finance technological upgrading, firms tend to prioritize internal funding, and use debt and equity financing as the last resort. In the context of incessant technological change, however, equity financing might be a better choice. This research highlights some aspects of how that is the case by analysing firm-level performance data from Thailand and then conducting in-depth interviews with top executives from several companies located in the Eastern Economic Corridor (EEC). We find that the conventional pecking order theory does not hold when it comes to external financing decisions. The interview insights reveal that, while a majority of companies prioritize internal financing, capturing technology (as intangible assets) via equity as well as non-equity linkages with foreign firms is also observed. Given that technological upgrading can result from FDI inflows by foreign firms, a truly “joint” nature of equity and non-equity forms of investment projects would serve as a win-win option for Thai and foreign firms, especially under the “Thailand 4.0” policy framework. [ABSTRACT FROM AUTHOR]