Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/195213 
Year of Publication: 
2018
Citation: 
[Journal:] SPOUDAI - Journal of Economics and Business [ISSN:] 2241-424X [Volume:] 68 [Issue:] 2/3 [Publisher:] University of Piraeus [Place:] Piraeus [Year:] 2018 [Pages:] 39-47
Publisher: 
University of Piraeus, Piraeus
Abstract: 
The aim of this paper is to examine the effect that Research and Development (R&D) expenditures have on a company's market value and earnings. Prior literature shows that R&D expenses have a positive impact on a firm's market performance, as well as a positive impact on a firm's earnings. The goal of this paper is not only to test the relation between R&D expenses and earnings and between R&D expenditures and market value, but also to prove that this relation changes as time passes. We show that while R&D expenses have an impact on market value in the short-run, their impact on earnings is stronger in the long-run. The sample consists of the companies listed in the North American Stock exchanges for the period 1993-2013 and for the industrial sector. Our results show a positive relation between R&D expenses and market value and between R&D expenses and earnings.
Subjects: 
R&D expenses
earnings
market capitalization
JEL: 
M40
M41
M48
Document Type: 
Article

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