Corporate research and development expenditures and share value

Investment opportunities and market reaction to capital expenditure decisions

“…For public utility ®rms, however, they ®nd that announcements of capital expenditure decisions do not have any material e ect on stock returns. Chan et al (1990) examine the market response to announcements of R&D spending by ®rms in both highand low-technology industries. They ®nd that those ®rms in high-technology industries which announce increases in R&D spending, on average, experience positive abnormal returns, but those in low-technology industries experience negative returns.…”

The stock market and investment in the small and open Norwegian economy

“…International evidence suggests that firms which undertake long-term investments are rewarded by the stock market. In particular, Chan, Martin and Kensinger (1990) find that the stock market is able to distinguish between good and poor investment projects, and only firms that make good investments are rewarded.…”

The Role of R&D Investment in Firm Valuation for Small and Medium Korean Companies

“…Hypothesis 2: Technology innovation has a nonlinear relationship with the market value of equity as it relates to the debt ratio of small and medium Korean companies Levin (1978), Chan et al (1990), and Mahmood and Lee (2004) report that industry entry barriers such as technology innovation are associated with R&D investment. This research substitutes technology innovation for R&D intensity, measured as the total R&D investment divided by total sales.…”

“…For example, Levin (1978) reveals that R&D intensity can be a barrier preventing other companies from entering some industries. Chan et al (1990) also report that the value relevance of technology innovation differs according to R&D intensity. Mahmood and Lee (2004) similarly report that R&D intensity, as a proxy for market competition, is significantly associated with a firm's value.…”