- Journal of Business Economics and Finance
- Vol: 2 Issue: 3
- The Effect of R&D Expenditure (Investments) On Firm Value: Case Of Istanbul Stock Exchange
The Effect of R&D Expenditure (Investments) On Firm Value: Case Of Istanbul Stock Exchange
Authors : Pınar Başgoze, Cem Sayin
Pages : 5-12
View : 5 | Download : 3
Publication Date : 2013-09-01
Article Type : Other
Abstract :The relationship between Research and Development (R&D) and creating value has been widely discussed in the past. Most of the studies revealed that there were positive relationships between R&D investments and firm value. The research has shown that R&D investments create value for firms due to their competitive advantages for the firm, when they are used as a differentiation strategy that creates new products of processes that are hard to be easily imitated by the competitors and that this creates brand equity. This study tested the ability of R&D investments to explain returns using single and multiple variable regression models. It was observed that (i) there were positive and strong relationships between the intensity of R&D investments and returns and (ii) firm size, contrary to expectations, was not related with returns.Keywords : R&D, firm value, stock returns, frirm size.