Market Value of the Firms and R&amp;D Investment: Theoretical Overview and Empirical Estimation for the Panel of Countries

Josheski, Dushko; Sopova, Marija Magdinceva

doi:10.2139/ssrn.2209759

Cited by 4 publications

(5 citation statements)

References 16 publications

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“…The extant research focuses on US and UK firms due to the salience and liquidity of their financial markets. Only a few comparative studies have examined firms in continental Europe (Hall and Oriani, 2006;Josheski and Sopova, 2013) due to the information opacity, less-developed financial markets, and limited number of listed firms in those countries (Duqui et al, 2011).…”

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confidence: 99%

“…Existing contributions are strongly focused on USA and UK firms due to the relevance and liquidity of the financial markets of these countries. There are few comparative studies (Hall and Oriani, 2006;Josheski and Sopova, 2013) for Continental European countries, as a result of the opacity of information, the less developed financial markets, and the limited number of listed firms (Duqui et al, 2011).…”

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confidence: 99%

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R&D innovation indicator and its effects on the market. An empirical assessment from a financial perspective

Coluccia

Dabić

Giudice

et al. 2020

Journal of Business Research

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We propose an alternative firm-level measure for innovation activities-R&D elasticity-and we analyse its effects on the Tobin's Q of listed companies on the Euronext 100 Index. We find that R&D elasticity is positively related to market appreciation by stakeholder investors. Moreover, we analyse the role of default risk in the relationship between innovation activities and market value, and find that firms' default probabilities are negatively related to Tobin's Q. These findings are supported by OLS regressions, wherein Tobin's Q is regressed on R&D elasticity, five-year default probability, and controls such as ESG voluntary disclosure. These results further the research aimed at developing a conceptual framework for integrating at a policy level the R&D elasticity indicator as a type of innovation disclosure among the non-financial disclosures released by companies.

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confidence: 99%

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confidence: 99%

R&D innovation indicator and its effects on the market. An empirical assessment from a financial perspective

Coluccia

Dabić

Giudice

et al. 2020

Journal of Business Research

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“…R&D investment is an important source of knowledge accumulation in enterprises. Josheski and Sopova (2013) found a positive and statistically significant relationship between R&D investment and firm’s market value using European data. Similarly, Hwang et al (2013) found that higher R&D investment in IT industry coupled with high foreign ownership result in higher firm valuation.…”

Section: Literature Reviewmentioning

confidence: 89%

Research on relationship between government innovation funding and firms value creation using clustering-rough sets

Zhu

Tian

et al. 2019

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Purpose The purpose of this paper is to reveal the pattern between government innovation funding and enterprise value creation. Many factors, including government innovation funding, R&D ability, corporate governance and some company characteristics significantly affected the efficiency of firm value creation. Design/methodology/approach This paper proposed a novel methodology based on clustering-rough sets to explore the characteristics of enterprise value creation behavior, and map the relationship between government innovation funding and enterprise value creation. The agglomerative hierarchical clustering (AHC) algorithm were used to classify firm performance and get two types of value creation efficiencies and to discretize condition attributes because the rough set theory cannot deal with continuous attributes. This paper utilized the rough sets method to realize data mining and get rules of government innovation funding and enterprise value creation. Findings R&D ability, proportion of independent directors, remuneration of directors, operating revenue, number of employees, price-earnings ratio, quick ratio, capital intensity and ROA were important to identify firm value creation efficiency when government funded the firms. Firms of high level of government innovation funding, high lagged R&D ratio, high remuneration of directors, low price-earnings ratio, low quick ratio, moderate capital intensity and high ROA were more likely to have high efficiency of value creation. Originality/value Since China implemented the innovation-driven development strategy, facilitating enterprise innovation has become an important way to achieve high-quality economic growth. With constantly increasing of Chinese government innovation funding, studying on the effect of government innovation funding on firm’s value creation is significant to improve the efficiency of government resource allocation. It is valuable to reveal the pattern between government innovation funding and enterprise value creation based on the value added theory. The rules obtained could be used to provide decision-making support to improve the efficiency of government innovation funding and prevent waste of government resources effectively.

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“…R&D intensity is used to measure innovations, and both product innovations and process innovations are considered helpful to improve the operation efficiency of firms. Research has also found that R&D intensity is positively related to firm performance (Bradley, Jarrell & Kim, 1984;Titman & Wessels, 1988;Crutchley & Hansen, 1989;McConnell & Servaes, 1990;Hermalin & Weisbach, 1991;Jensen et al, 1992;Hirschey & Weygandt, 1993;Klette, 1996;Delios & Beamish, 1999;Kotabe et al, 2002;Lu & Beamish, 2004;Bae et al, 2008;Missaka, 2015;Josheski & Sopova, 2013;Shih-Yung et. al., 2017).…”

Section: Randd Expense Ratiomentioning

confidence: 99%

The Influence of Taiwan Electronic Production Company's Proprietary Data Products on the Interaction of Company Effectiveness

Wei

Lin²

2021

JAREAS

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Purpose: The purpose of this study is to explore the unique interaction of companies in Taiwan from 1998 to 2017 and the influence of the degree of international industry on the effectiveness of the company. Approach/Methodology/Design: We used time series methods to investigate and research. This study only has a significant impact on the upstream industry of the electronics industry, and there is no significant development in the middle and lower reaches of the industry. This is a very strange situation in Taiwan. Findings: At the same time, the interaction of the three attributes of the midstream computer industry can also produce the multiplication effect. In this study, it has been found that the degree of international internationalization has a higher impact on the effectiveness of companies, but no matter how high it is, it seems that increasing the degree of international internationalization at about 10% or 50% and more than 80% of the international level can produce and increase the effectiveness of the company. Practical Implications: This is a very strange situation in Taiwan. However, because the research strength has the effect of prolonging the effect, it may not play a significant role in the middle and lower reaches of the research and development of the product extension effect, so that the research intensity does not play a significant role in the first year of the development of the Taiwan electronics industry. Originality/value: Our value is mainly to solve the problems of internationalization and performance of Taiwanese electronics industry companies.

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Market Value of the Firms and R&D Investment: Theoretical Overview and Empirical Estimation for the Panel of Countries

Cited by 4 publications

References 16 publications

R&D innovation indicator and its effects on the market. An empirical assessment from a financial perspective

R&D innovation indicator and its effects on the market. An empirical assessment from a financial perspective

Research on relationship between government innovation funding and firms value creation using clustering-rough sets

The Influence of Taiwan Electronic Production Company's Proprietary Data Products on the Interaction of Company Effectiveness

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