Research On The Relationship Between R&D Expenditure And Firm Value Of High-tech Enterprises

Technology innovation is a strong support for potential profitability and growth of enterprises, and is an important means to improve comprehensive national strength and competitiveness. Under the guidance of the strategy of building an innovative country, the absolute number and relative number of R&D expenditure of China has showed a rising trend. But there is still a long way to go to catch those technologically advanced countries because we have comparatively weak ability of independent innovation. R&D activities are long-period, big investment, high risky and high-yield, successful R&D projects usually give businesses sustained and profitable returns. Many theories, like technical innovation theory, core competitiveness theory, and signal theory etc., have demonstrated the effect of R&D expenditures in promoting enterprise value. Many empirical researches, conducted by foreign scholars, showed that R&D expenditure is positively correlated with the enterprise market value, but those results are not adequate for Chinese firms. Many studies conducted by Chinese experts, because of information acquisition problem, selected short-term samples of 2-3 years or even 1 year only, considering the comparatively long cycle of R&D activities, short-term researches can hardly draw valid conclusions.72 A–share listed high-tech enterprises, which regularly disclose the R&D expenditure information during 2010-2014, are selected as research samples in this paper. Taking the natural logarithm of Tobin’s Q as explained variable, R&D intensity as explaining variable,and four financial indexes as control variables, this paper constructs a multivariate linear regression model to study the relationship between R&D expenditure and firm value, the lagging effect and cumulative effect. Empirical results show that:(1) R&D expenditure does not have significant positive correlation with current market value.(2) R&D expenditure has a significant lagging effect on promoting firm value at lag 2 and lag 3, while has no significant effect at lag 1 and lag 4. Furthermore, regression coefficient and significance level of lag 2 are higher than that of lag 3.(3) R&D expenditure has a cumulative promotion effect on firm value, and positive effect can be enhanced and significant level be improved over time.