IMPACT OF R&D INVESTMENT ON FIRM PERFORMANCE AND FIRM VALUE: EVIDENCE FROM DEVELOPED NATIONS (G-7)

Autores

  • Muhammad Usman School of Finance Zhongnan University of Economics and Law Wuhan P.R.China
  • Muhammad Shaique School of Accounting Zhongnan University of Economics and Law Wuhan, P.R. China
  • Shahbaz Khan School of Finance Zhongnan University of Economics and Law Wuhan P.R. China
  • Ruqia Shaikh School of Accounting Zhongnan University of Economics and Law Wuhan P.R. China
  • Nida Baig College of Public Administration Huazhong University of Science and Technology Wuhan P.R. China

DOI:

https://doi.org/10.18028/rgfc.v7i2.3206

Palavras-chave:

R&D investment, Firm Performance, Firm Value, HLM Regression model, G-7 Countries

Resumo

The purpose of the study is to evaluate the impact of R&D investment on firm performance and firm value among G-7 countries. To testify such relationship we use firm level and country level data collected from firms’ financial statement, countries stock exchanges and World Bank databases. Based on data structure (country level, industry level and firm level) we use HLM regression analysis technique along with robust standard error. By using diverse range of control variables (firm size, age, leverage, GDP growth, interest rate and financial crises dummy), results suggest that same year R&D investment has negative impact on firm performance and positive impact on firm value. However one year lagged period R&D investment has positive relationship with both firm performance and firm value. Nevertheless two year lagged period R&D investment has not effect on both firm performance and value.

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Publicado

03/14/2017

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Artigos Internacionais