TITLE:
The Effect of R&D Investment on Firms’ Financial Performance: Evidence from the Chinese Listed IT Firms
AUTHORS:
Zhaohui Zhu, Feng Huang
KEYWORDS:
R&D; ROE; IT firms
JOURNAL NAME:
Modern Economy,
Vol.3 No.8,
December
31,
2012
ABSTRACT: Technological innovation by R&D is at the core of business strategy for firms to compete in the competitive market. This paper tests the correlation between firms R&D investment intensity and the one-year lagged performance of Chinese Listed IT firms, and suggests that firms with an intensive investment strategy in R&D will have significantly larger financial performances in the following year.