Further Examinations on the Financial Aspects of R&D Expenditure For Firms Listed on the KOSPI Stock Market

국내 KOSPI 상장기업들의 연구개발비 관련 재무적 요인 심층분석

  • Kim, Hanjoon (Division of Business Administration, Hoseo University)
  • 김한준 (호서대학교 사회과학대학 경영학부)
  • Received : 2018.01.15
  • Accepted : 2018.04.06
  • Published : 2018.04.30


The study examines corporate research & development (R&D) expenditure in modern finance. Firms may face one of the essential issues to maintain their optimal levels of R&D expenditures in order to increase corporate profit. Accordingly, financial determinants that may influence R&D spending are statistically tested for firms listed on the KOSPI stock market during the period from 2010 to 2015. Financial determinants which may discriminate between firms in high-growth and low-growth industries are examined on a relative basis. Explanatory variables including one-period lagged R&D expenses (Lag_RD), cross-product term between the Lag_RD and type of industry (as a dummy variable), and advertising expenses (ADVERTISE) significantly influenced corporate R&D intensity. Moreover, high-growth firms in domestic capital markets showed higher Lag_RD, profitability (PROF) and foreign equity ownership (FOS) than their counterparts in low-growth sectors, whereas low-growth firms had higher market-value based leverage (MLEVER) and ADVERTISE. Overall, these results are expected to influence decision-making of firms concerning the optimal level of R&D expenditure, which may in turn enhance shareholder wealth.


Binary Dependent Variable Model;Global Financial Turmoil;Korean Domestic Market;KOSPI-listed Firms;Research & Development (R&D) Intensity;Static Panel Data Model


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