Research and development (R&D) activities are usually considered a key factor for achieving superior performances. Using a sample of 11,897 manufacturing Italian firms, we examine the relationship between R&D expenditure that is capitalized as an intangible asset and some proxies of firm profitability over a period of four years in order to explore whether R&D assets can help investors in the identification of profitable firms. Contrary to expectations, this paper found a negative and/or an insignificant association between R&D assets and proxies of firm profitability. Although there are several possible explanations for this result, what we learn from this study is that R&D assets are not on average a reliable indicator for detecting profitable firms. Research findings revealed that firms with R&D assets appear to be not so profitable, large and levered.
What R&D assets say about firm profitability / Santosuosso, Pierluigi. - In: INTERNATIONAL BUSINESS RESEARCH. - ISSN 1913-9004. - STAMPA. - 9:6(2016), pp. 64-71. [10.5539/ibr.v9n6p64]
What R&D assets say about firm profitability
SANTOSUOSSO, Pierluigi
2016
Abstract
Research and development (R&D) activities are usually considered a key factor for achieving superior performances. Using a sample of 11,897 manufacturing Italian firms, we examine the relationship between R&D expenditure that is capitalized as an intangible asset and some proxies of firm profitability over a period of four years in order to explore whether R&D assets can help investors in the identification of profitable firms. Contrary to expectations, this paper found a negative and/or an insignificant association between R&D assets and proxies of firm profitability. Although there are several possible explanations for this result, what we learn from this study is that R&D assets are not on average a reliable indicator for detecting profitable firms. Research findings revealed that firms with R&D assets appear to be not so profitable, large and levered.File | Dimensione | Formato | |
---|---|---|---|
Santosuosso_R&D-Assets_2016.pdf
accesso aperto
Tipologia:
Documento in Post-print (versione successiva alla peer review e accettata per la pubblicazione)
Licenza:
Creative commons
Dimensione
404.56 kB
Formato
Adobe PDF
|
404.56 kB | Adobe PDF |
I documenti in IRIS sono protetti da copyright e tutti i diritti sono riservati, salvo diversa indicazione.