Firm Size and R&D; Testing the Schumpeterian Hypothesis

This paper aims solely to look at the question of R&D, research and development, expenditure. More specifically, this paper asks the question, What is the relationship between the size of the firm and R&D? And do larger firms spend more on R&D relative to their size than smaller firms? The answers to these questions have important implications concerning a firm\u27s incentives for growth and innovation. These answers will also put us a step closer to understanding the functions performed by firms as Coase suggests