An examination of long-term abnormal stock returns and operating performance following R & D increases

Deskripsi

We examine a sample of 8,313 cases, between 1951 and 2001, where firms unexpectedly increase their research and development ( R & D ) expenditures by a significant amount. We find consistent evidence of a misreaction, as manifested in the significantly positive abnormal stock returns that our sample firms' shareholders experience following these increases. We also find consistent evidence that our sample firms experience significantly positive long-term abnormal operating performance following their R & D increases..Printed Journal