The impact of investor sentiment on corporate research and development : an empirical study.
This academic study seeks to explore the role of behavioral finance in influencing R&D spending decision in the U.S. We analyze 5,581 firm-years of R&D data for firms listed in the U.S. S&P 500 index for the period 1966-2004. Specifically, we wish to investigate the impact investors'...
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Main Authors: | , , |
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Format: | Final Year Project |
Published: |
2008
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Subjects: | |
Online Access: | http://hdl.handle.net/10356/10474 |
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Institution: | Nanyang Technological University |
Summary: | This academic study seeks to explore the role of behavioral finance in influencing R&D spending decision in the U.S. We analyze 5,581 firm-years of R&D data for firms listed in the U.S. S&P 500 index for the period 1966-2004. Specifically, we wish to investigate the impact investors' sentiment has on corporate R&D expense. The significant results indicate that managers increase their R&D expenditure in response to a bullish market. Similarly, R&D activity declines when the market is bearish. The contribution of our study therefore highlights the presence of the interaction of investor sentiment and R&D spending activity. |
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