Does the market value R&D investment by European firms? Evidence from a panel of manufacturing firms in France, Germany, and Italy

International Journal of Industrial Organization

Volumn 24, Issue 5, 2006, Pages 971-993

  Hall, Bronwyn H ^a   Oriani, Raffaele ^b  

^a UNIVERSITY OF CALIFORNIA   (United States)

^b UNIVERSITY OF BOLOGNA   (Italy)

Author keywords

Control; European companies; Market value; R D

Indexed keywords

ADMINISTRATIVE DATA PROCESSING; DATABASE SYSTEMS; INDUSTRIAL ECONOMICS; INDUSTRIAL MANAGEMENT; INVESTMENTS; PROCESS CONTROL;

EUROPEAN COMPANIES; MARKET VALUE; R&D; SHAREHOLDERS;

RESEARCH AND DEVELOPMENT MANAGEMENT;

EID: 33746780066     PISSN: 01677187     EISSN: None     Source Type: Journal    
DOI: 10.1016/j.ijindorg.2005.12.001     Document Type: Article

References (53)

1. Aboody D., and Lev B. Information asymmetry, R&D, and insider gains. Journal of Finance 55 (2000) 2747-2766
2. Alexander D., and Archer S. European Accounting Guide (1998), Harcourt Brace, San Diego
3. Allen J.W., and Phillips G.M. Corporate equity ownership, strategic alliances, and product market relationships. Journal of Finance 55 (2000) 2791-2815
4. Angelini P., Di Salvo R., and Ferri G. Availability and cost of credit for small businesses: customer relationships and credit cooperatives. Journal of Banking and Finance 22 (1998) 925-954
5. Belcher A. R&D disclosure: theory and practice. In: Belcher A., Hassard J., and Procter S. (Eds). R&D Decisions: Strategy, Policy and Disclosure (1996), Routledge, London
6. Black A.J., and Fraser P. International comparisons on stock market short-termism: how different is the UK experience?. Manchester School 68 (2000) 38-50 (supplement)
7. Bloom N., and Van Reenen J. Patents, real options and firm performance. Economic Journal 112 (2002) 97-116
8. Blundell R., Bond S., Devereux M., and Schiantarelli F. Investment and Tobin's Q. Journal of Econometrics 51 (1992) 233-257
9. Blundell R., Griffith R., and Van Reenen J. Market share, market value and innovation in a panel of British manufacturing firms. Review of Economic Studies 66 (1999) 529-554
10. Bond S., Elston J., Mairesse J., and Mulkay B. Financial factors and investment in Belgium, France, Germany and the UK: a comparison using company panel data. Review of Economics and Statistics 85 (2003) 153-177
11. Bond S., Harhoff D., Van Reenen J. 2003b. Corporate R&D and productivity in Germany and the United Kingdom. CEP Discussion Paper 595, London School of Economics, London.
12. Cockburn I., and Griliches Z. Industry effects and appropriability measures in the stock market's valuation of R&D and patents. American Economic Review 78 (1988) 419-423
13. Das M., Newey W.K., and Vella F. Nonparametric estimation of sample selection models. Review of Economic Studies 70 (2003) 33-58
14. David P.A., Hall B.H., and Toole A.A. Is public R&D a complement or substitute for private R&D? A review of the econometric evidence. Research Policy 29 (2000) 497-529
15. Deng Z., Lev B. 1998. The valuation of acquired R&D. Working Paper, New York University, New York.
16. Faccio M., and Lang L.P.H. The ultimate ownership of Western European corporations. Journal of Financial Economics 65 (2002) 365-414
17. Franks J., and Mayer C. Capital markets and corporate control: a study of France, Germany and the UK. Economic Policy 10 (1990) 189-232
18. Gomes A. Going public without governance: managerial reputation effects. Journal of Finance 55 (2000) 615-646
19. Gompers P., Ishii J.L., and Metrick A. Corporate governance and equity prices. Quarterly Journal of Economics 118 (2003) 107-155
20. Griliches Z. Market value, R&D and patents. Economics Letters 7 (1981) 183-187
21. Griliches Z., and Hausman J.A. Errors in variables in panel data. Journal of Econometrics 31 (1986) 93-118
22. Griliches Z., and Mairesse J. Productivity and R&D at the firm level. In: Griliches Z. (Ed). R&D, Patents, and Productivity (1984), Chicago University Press, Chicago
23. Hall B. H. 1990. The manufacturing sector masterfile: 1959-1987. National Bureau of Economic Research Working Paper 3366, Cambridge, MA.
24. Hall B.H. Industrial research during the 1980s: did the rate of return fall? Brookings papers on economic activity. Microeconomics (1993) 289-343
25. Hall B.H. The stock market's valuation of R&D investment during the 1980's. American Economic Review 83 (1993) 259-264
26. Hall B.H. The private and social returns to research and development. In: Smith B., and Barfield C. (Eds). Technology, R&D and the Economy (1996), AEI-Brookings Institutions, Washington, DC
27. Hall B.H. Innovation and market value. In: Barrell R., Mason G., and O'Mahoney M. (Eds). Productivity, Innovation and Economic Performance (2000), Cambridge University Press, Cambridge
28. Hall B.H. The financing of research and development. Oxford Review of Economic Policy 18 (2002) 35-51
29. Hall, B.H., Kim, D. 2000. Valuing intangible assets: the stock market value of R&D revised, Working Paper. University of California at Berkeley and Harvard University, Berkeley, CA and Cambridge, MA.
30. Hall B.H., and Van Reenen J. How effective are fiscal incentives for R&D? A review of the evidence. Research Policy 29 (2000) 449-469
31. Hall B.H., Vopel K. 1996. Innovation, market share and market value, Working Paper, University of California at Berkeley and University of Mannheim: Berkeley, CA and Mannheim.
32. Hall B.H., Jaffe A.B., and Trajtenberg M. Market value and patent citations. Rand Journal of Economics 36 (2005) 16-38
33. Hall B.H., Mairesse J., Branstetter L., and Crepon B. Does cash flow cause investment and R&D: an exploration using panel data for French, Japanese, and United States scientific firms. In: Thurik A.R. (Ed). Innovation, Industry Evolution, and Employment (1999), Cambridge University Press, Cambridge
34. Hausman J.A. Specification tests in econometrics. Econometrica 46 (1978) 1251-1272
35. Hirschey M. Intangible capital aspects of advertising and R&D expenditures. Journal of Industrial Economics 30 (1982) 375-390
36. Jaffe A.B. Technological opportunity and spillovers of R&D: evidence from firms' patents, profits, and market value. American Economic Review 76 (1986) 984-1001
37. KPMG. TRANSACC. Transnational Accounting (1995), Macmillan, London
38. La Porta R., Lopez-De-Silanes F., Shleifer A., and Vishny R. Law and finance. Journal of Political Economy 106 (1998) 1113-1135
39. La Porta R., Lopez-De-Silanes F., and Shleifer A. Corporate ownership around the world. Journal of Finance 54 (1999) 471-516
40. La Porta R., Lopez-De-Silanes F., Shleifer A., and Vishny R. Investor protection and corporate governance. Journal of Financial Economics 58 (2000) 3-27
41. La Porta R., Lopez-De-Silanes F., Shleifer A., and Vishny R. Investor protection and corporate valuation. Journal of Finance 57 (2002) 1147-1170
42. Lee L.F. Some approaches to the correction of selectivity bias. Review of Economic Studies 49 (1982) 355-372
43. Lev B., and Sougiannis T. The capitalization, amortization, and value-relevance of R&D. Journal of Business, Accounting and Economics 21 (1996) 107-138
44. Maddala G.S. Limited-Dependent and Qualitative Variables in Econometrics (1983), Cambridge University Press, Cambridge
45. Meulbroek L.K., Mitchell M.L., Mulherin J.H., Netter J., and Poulsen A.B. Shark repellents and managerial myopia: an empirical test. Journal of Political Economy 98 (1990) 1108-1117
46. Mulkay B., Hall B.H., Mairesse J., 2000. Firm level investment and R&D in France and the United States: A comparison. National Bureau of Economic Research Working Paper 8038: Cambridge, MA.
47. Munari F., and Oriani R. Privatization and economic returns to R&D investments. Industrial and Corporate Change 14 (2005) 61-91
48. Newey, W. K. 1988. Two-step series estimation of sample selection models, MIT Working Paper, Cambridge, MA.
49. Oriani R., and Sobrero M. A meta-analytic study of the relationship between R&D investments and corporate value. In: Calderini M., Garrone P., and Sobrero M. (Eds). Corporate Governance, Market Structure and Innovation (2003), Edward Elgar, Cheltenham, UK
50. Pagano M., Panetta F., and Zingales F. Why do companies go public? An empirical analysis. Journal of Finance 53 (1998) 27-64
51. Parisi M.L., Sembenelli A., 2001. Is private R&D spending sensitive to its price? Empirical evidence on panel data for Italy, Boston College Working Paper in Economics 493. Boston.
52. Seaton J., and Walker I. R&D in UK quoted companies: the effects of disclosure and finance. In: Belcher A., Hassard J., and Procter S. (Eds). R&D Decisions. Strategy, Policy and Disclosure (1996), Routledge, London
53. Toivanen O., Stoneman P., and Bosworth D. Innovation and market value of UK Firms, 1989-1995. Oxford Bulletin of Economics and Statistics 64 (2002) 39-61