Figure 1Research model. AD = advertising; BOD = size of the board of directors; R&D = research and development; SG&A = selling and administrative expenses.
Table 1Annual distribution of sample firms.
Yr |
Firms |
Share |
Cumulative |
2000 |
39 |
4.96 |
4.96 |
2001 |
42 |
5.34 |
10.31 |
2002 |
48 |
6.11 |
16.41 |
2003 |
51 |
6.49 |
22.90 |
2004 |
52 |
6.62 |
29.52 |
2005 |
56 |
7.12 |
36.64 |
2006 |
58 |
7.38 |
44.02 |
2007 |
62 |
7.89 |
51.91 |
2008 |
68 |
8.65 |
60.56 |
2009 |
72 |
9.16 |
69.72 |
2010 |
77 |
9.80 |
79.52 |
2011 |
80 |
10.18 |
89.69 |
2012 |
81 |
10.31 |
100.00 |
Table 2Summary of hypotheses.
Hypotheses |
1 |
Profitability (ROI) will have a positive correlation with R&D investment. |
2 |
Growth (SG) will have a positive correlation with R&D investment. |
3 |
Liquidity (LIQ) will have a positive correlation with R&D investment. |
4 |
Stability (LEV) will have a negative correlation with R&D investment. |
Table 3Descriptive statistics.
Variable |
Obs |
Mean |
SD |
Min |
Max |
RD |
786.00 |
6.29 |
9.10 |
0.12 |
99.07 |
SIZE |
786.00 |
7.97 |
0.43 |
6.98 |
9.24 |
YEAR |
786.00 |
1.02 |
0.43 |
0.00 |
1.71 |
BS |
786.00 |
0.70 |
0.15 |
0.00 |
1.18 |
AD |
786.00 |
3.53 |
3.32 |
0.00 |
23.32 |
SAE |
786.00 |
36.33 |
14.56 |
3.26 |
141.77 |
ROI |
786.00 |
4.58 |
8.93 |
−63.34 |
41.50 |
SG |
786.00 |
10.73 |
25.31 |
48.72 |
501.81 |
LIQ |
786.00 |
361.77 |
296.09 |
35.20 |
2269.89 |
LEV |
786.00 |
67.29 |
91.37 |
0.00 |
1549.72 |
Table 4Annual average of the variables.
Yr |
RD |
SIZE |
YEAR |
BS |
AD |
SAE |
ROI |
SG |
LIQ |
LEV |
2000 |
2.15 |
7.87 |
0.95 |
0.72 |
5.08 |
36.55 |
4.85 |
12.16 |
282.13 |
110.60 |
2001 |
2.38 |
7.87 |
0.96 |
0.75 |
5.39 |
35.74 |
8.62 |
13.55 |
313.66 |
124.72 |
2002 |
2.93 |
7.83 |
0.94 |
0.71 |
4.89 |
36.03 |
6.03 |
10.08 |
376.72 |
78.09 |
2003 |
3.95 |
7.84 |
0.96 |
0.72 |
4.26 |
37.50 |
4.71 |
5.25 |
404.18 |
79.78 |
2004 |
4.60 |
7.88 |
1.00 |
0.72 |
3.57 |
35.75 |
5.34 |
9.52 |
407.34 |
58.79 |
2005 |
5.50 |
7.91 |
1.01 |
0.69 |
3.45 |
37.71 |
4.49 |
11.99 |
423.39 |
55.87 |
2006 |
5.79 |
7.94 |
1.06 |
0.70 |
3.63 |
38.30 |
4.22 |
8.57 |
431.40 |
59.29 |
2007 |
6.63 |
7.96 |
1.04 |
0.68 |
3.82 |
38.38 |
4.54 |
10.98 |
414.59 |
55.27 |
2008 |
7.00 |
7.98 |
1.02 |
0.71 |
3.26 |
37.17 |
4.59 |
19.84 |
343.75 |
55.77 |
2009 |
7.18 |
8.02 |
1.02 |
0.70 |
2.96 |
36.09 |
4.63 |
15.59 |
340.67 |
60.24 |
2010 |
8.15 |
8.05 |
1.04 |
0.68 |
2.73 |
35.47 |
4.98 |
13.58 |
340.27 |
56.46 |
2011 |
8.45 |
8.09 |
1.07 |
0.69 |
2.78 |
34.29 |
3.64 |
5.62 |
300.05 |
62.79 |
2012 |
10.25 |
8.11 |
1.11 |
0.69 |
2.49 |
34.78 |
1.77 |
4.07 |
342.62 |
61.37 |
TOTAL |
6.29 |
7.97 |
1.02 |
0.70 |
3.53 |
36.33 |
4.58 |
10.73 |
361.77 |
67.29 |
Table 5Pearson's correlation coefficients.
|
RD |
ROI |
SG |
LIQ |
LEV |
SIZE |
YEAR |
BS |
AD |
SAE |
RD |
1 |
|
|
|
|
|
|
|
|
|
ROI |
−0.1677* |
1 |
|
|
|
|
|
|
|
|
SG |
0.0168 |
0.1218* |
1 |
|
|
|
|
|
|
|
LIQ |
0.2329* |
0.1519* |
−0.0206 |
1 |
|
|
|
|
|
|
LEV |
−0.0567 |
−0.2936* |
−0.032 |
−0.3012* |
1 |
|
|
|
|
|
SIZE |
0.0389 |
0.1020* |
−0.0328 |
−0.3840* |
0.1238* |
1 |
|
|
|
|
YEAR |
−0.2109* |
−0.1734* |
−0.0942* |
−0.3208* |
0.2156* |
0.5650* |
1 |
|
|
|
BS |
−0.0075 |
0.0887* |
0.0194 |
−0.1823* |
0.0482 |
0.4694* |
0.3439* |
1 |
|
|
AD |
−0.0914* |
0.0790* |
−0.0555 |
−0.0967* |
−0.0518 |
0.2471* |
0.1575* |
0.0786* |
1 |
|
SAE |
0.2426* |
−0.4497* |
−0.0467 |
0.0439 |
0.1129* |
−0.0728* |
0.1075* |
0.0034 |
0.3469* |
1 |
Table 6Result.
|
Coef. |
S.E |
Coef. |
S.E |
Coef. |
S.E |
Coef. |
S.E |
Coef. |
S.E |
Coef. |
S.E |
SIZE |
4.513‡
|
1.159 |
4.460‡
|
1.162 |
4.178‡
|
1.160 |
4.748‡
|
1.160 |
4.507‡
|
1.156 |
4.314‡
|
1.161 |
YEAR |
1.338 |
0.912 |
1.29 |
0.915 |
1.405 |
0.908 |
1.384 |
0.909 |
1.226 |
0.911 |
1.309 |
0.911 |
BS |
−1.933 |
1.586 |
−1.935 |
1.587 |
−1.522 |
1.586 |
−1.776 |
1.583 |
−1.865 |
1.583 |
−1.461 |
1.583 |
AD |
−0.106 |
0.0826 |
−0.0995 |
0.0833 |
−0.101 |
0.0822 |
−0.0997 |
0.0824 |
−0.131 |
0.0833 |
−0.122 |
0.0839 |
SAE |
0.0289 |
0.0197 |
0.0208 |
0.0234 |
0.018 |
0.0200 |
0.0262 |
0.0196 |
0.0329* |
0.0197 |
0.0146 |
0.0241 |
ROI |
|
|
−0.0166 |
0.0259 |
|
|
|
|
|
|
0.022 |
0.0476 |
SG |
|
|
|
|
−0.0165‡
|
0.00597 |
|
|
|
|
−0.0153†
|
0.0060 |
LIQ |
|
|
|
|
|
|
0.00167†
|
0.00073 |
|
|
0.00146* |
0.00075 |
LEV |
|
|
|
|
|
|
|
|
−0.00399†
|
0.00190 |
−0.00408†
|
0.00195 |
Constant |
−30.35‡
|
8.770 |
−29.53‡
|
8.868 |
−27.49‡
|
8.791 |
−32.91‡
|
8.817 |
−30.02‡
|
8.751 |
−28.55‡
|
8.887 |
Obs |
786 |
786 |
786 |
786 |
786 |
786 |
Adj |
0.072 |
0.072 |
0.082 |
0.079 |
0.078 |
0.095 |
ID |
81 |
81 |
81 |
81 |
81 |
81 |