The Different Effects of Firm Resources on Firm Performance under Volatility: An Examination Using Big Data
According to the resource-based view, research and development (R&D) and advertising are critical resources firms use to improve their performance. This study aims to clarify the different effects of R&D and advertising on firm performance using distinct criteria—firm value and firm profitab...
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| Main Authors: | , |
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| Format: | Article |
| Language: | English |
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Wiley
2022-01-01
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| Series: | Discrete Dynamics in Nature and Society |
| Online Access: | http://dx.doi.org/10.1155/2022/6151667 |
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| _version_ | 1832554751947964416 |
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| author | Xuelian Piao MyeongCheol Choi |
| author_facet | Xuelian Piao MyeongCheol Choi |
| author_sort | Xuelian Piao |
| collection | DOAJ |
| description | According to the resource-based view, research and development (R&D) and advertising are critical resources firms use to improve their performance. This study aims to clarify the different effects of R&D and advertising on firm performance using distinct criteria—firm value and firm profitability. It also verifies whether the effects of R&D and advertising apply in a volatile environment. We run panel data regression models with a big data sample of manufacturing firms publicly listed on the Korea Composite Stock Price Index over an extended period of 27 years. We find that R&D has more positive effects on firm value than advertising, while advertising has more positive effects on firm profitability than R&D; these relationships are consistent even when volatility is considered. This suggests that firms should mix and match their investments between R&D and advertising resources for improved effectiveness and efficiency, and these resources should be accumulated and exploited consistently regardless of environmental dynamics. |
| format | Article |
| id | doaj-art-3350abae6431494498efcc6e21341acc |
| institution | Kabale University |
| issn | 1607-887X |
| language | English |
| publishDate | 2022-01-01 |
| publisher | Wiley |
| record_format | Article |
| series | Discrete Dynamics in Nature and Society |
| spelling | doaj-art-3350abae6431494498efcc6e21341acc2025-02-03T05:50:37ZengWileyDiscrete Dynamics in Nature and Society1607-887X2022-01-01202210.1155/2022/6151667The Different Effects of Firm Resources on Firm Performance under Volatility: An Examination Using Big DataXuelian Piao0MyeongCheol Choi1College of BusinessDepart of BusinessAccording to the resource-based view, research and development (R&D) and advertising are critical resources firms use to improve their performance. This study aims to clarify the different effects of R&D and advertising on firm performance using distinct criteria—firm value and firm profitability. It also verifies whether the effects of R&D and advertising apply in a volatile environment. We run panel data regression models with a big data sample of manufacturing firms publicly listed on the Korea Composite Stock Price Index over an extended period of 27 years. We find that R&D has more positive effects on firm value than advertising, while advertising has more positive effects on firm profitability than R&D; these relationships are consistent even when volatility is considered. This suggests that firms should mix and match their investments between R&D and advertising resources for improved effectiveness and efficiency, and these resources should be accumulated and exploited consistently regardless of environmental dynamics.http://dx.doi.org/10.1155/2022/6151667 |
| spellingShingle | Xuelian Piao MyeongCheol Choi The Different Effects of Firm Resources on Firm Performance under Volatility: An Examination Using Big Data Discrete Dynamics in Nature and Society |
| title | The Different Effects of Firm Resources on Firm Performance under Volatility: An Examination Using Big Data |
| title_full | The Different Effects of Firm Resources on Firm Performance under Volatility: An Examination Using Big Data |
| title_fullStr | The Different Effects of Firm Resources on Firm Performance under Volatility: An Examination Using Big Data |
| title_full_unstemmed | The Different Effects of Firm Resources on Firm Performance under Volatility: An Examination Using Big Data |
| title_short | The Different Effects of Firm Resources on Firm Performance under Volatility: An Examination Using Big Data |
| title_sort | different effects of firm resources on firm performance under volatility an examination using big data |
| url | http://dx.doi.org/10.1155/2022/6151667 |
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