R&D RELATIONSHIP AND THE GOOD LAW OF BRAZILIAN PUBLICLY-HELD CAPITAL COMPANIES

Abstract

Law nº 11.196/2005, known as Lei do Bem, has as its main objective to encourage companies to invest in Research, Development and Technological Innovation (RD&I). The encouragement of these companies is carried out in the form of tax incentives by the federal government, but there are some limitations and rules for the institutions to achieve. To obtain the data from the current study, publicly traded institutions between the years 2006 to 2019, benefiting from the tax incentive and using Economatica® as a database, were analyzed. The research presented is quantitative, using the regression model through documents and Explanatory Notes available at Economatica® and in the reports of the Ministry of Science, Technology, Innovation and Communications (MCTIC). The model used and variables from the studies by Chen and Gupta (2017) were adapted, unlike other studies, to assess the significance of the Law of Good. In this scenario, it was necessary to evaluate the variable along with other variants such as Cash flow before the Research and Development (PRE) and Rate that measures how the company is in the fiscal part (Tax). Furthermore, it was observed that R&D and Lei do Bem can economically help Brazil with, for example, the creation of new R&D centers and product development processes, consequently improving and benefiting the R&D culture in the country. Given this scenario, we can state that there was 10% significance of the Lei do Bem variable, in the inversion of the independent and dependent variables, thus, it obtained 10% significance for the variables related to R&D, with the other variables and 0, 5% for the variable that relates company size to fiscal status. Based on these results, we can say that there is a relationship between R&D expenditures and the Lei do Bem.