R&D Productivty: an International Study

Yuan Ding, Hervé Stolowy () and Tenenhaus Michel ()

No 781, HEC Research Papers Series from HEC Paris

Abstract: The objective of this paper is to explore the impact of R&D expenditures on company performance. R&D activities play an essential role in the future economic development and financial performance of firms. However, with the exception of some American studies, the economic effectiveness of such investment is seldom demonstrated explicitly by the literature, and to the best of our knowledge, there are no existing studies on R&D productivity taking an international approach. Our research design is based on an earnings equation associating earnings with recorded assets, R&D expenditures and selling, general and administrative (SG&A) expenses (proxying advertising expenses). We determine a rate of return on R&D for each given sample of firms in 12 developed countries. Our results corroborate previous studies of American companies, which found that reported earnings, adjusted for the expensing of R&D, reflect realized benefits from R&D. This study confirms the positive contribution of R&D activities to future company performance, although this contribution can vary from one country to another.

Keywords: R&D productivity; R&D profitability; international study (search for similar items in EconPapers)
JEL-codes: O32 (search for similar items in EconPapers)
Pages: 39 pages
Date: 2003-03-01
New Economics Papers: this item is included in nep-dev, nep-eff, nep-ino and nep-tid
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
http://www.hec.fr/var/fre/storage/original/applica ... 89ad8dfd7ae3bf16.pdf (application/pdf)

Related works:
Working Paper: R&D productivity: an international study (2003)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ebg:heccah:0781

Access Statistics for this paper

More papers in HEC Research Papers Series from HEC Paris HEC Paris, 78351 Jouy-en-Josas cedex, France. Contact information at EDIRC.
Bibliographic data for series maintained by Antoine Haldemann ().