Title: Stability without Certainties: Firm R&D Choices in the Midst of Military Coups: The Case of Thailand

Abstract:

Why do firms invest in R&D amidst political uncertainty and what are their strategies? Prior literature finds political uncertainty deters R&D investment but tends to conflate stability (i.e., maintaining day-to-day operations) with uncertainty (i.e., lack of long-term political outlook). We use firm-level R&D survey data from Thailand and analyze changes before and after the country’s 2014 military coup, which affords the possibility to study disruptions that enhance stability without certainty. We find that post-coup, firms increase R&D investment, increase variable R&D more than fixed R&D spending, and that firms in high-tech industries will invest more than those in low-tech industries. To further understand these quantitative survey analyses, we conducted interviews with senior officials who are or were in the leadership of several of the Thai scientific agencies during this time. Interestingly, these bureaucrats note that coups actually made things easier and they used the coups as an institutional opportunity for restructuring in ways that expanded their influence. Through these findings, we contribute to our understanding of political uncertainty and R&D.

Bio:

https://www.sbs.ox.ac.uk/about-us/people/daniel-armanios