The Persistence and Market Reaction of R&D Investment
The study investigates the value relevance of R&D investment and the reactions of investors in Korean stock markets over the period of 2001-2008. This paper examines whether R&D investment is associated with equity value and whether the information of R&D investment is truly reflected on the Korean stock markets. Consistent with the hypothesis and prior researches, the empirical results of this paper documents that R&D investment is significantly related to the market value of equity and Korean investors quickly recognize the implication of R&D investment information.