The Relation between Cash Holdings and R&D Expenditures According to Ownership Structure

Hyuna Kim, Sun Young Park

Research output: Contribution to journalArticlepeer-review

7 Scopus citations

Abstract

In this paper, we examine how the cash holdings have an impact on R&D expenditures and whether the ownership mechanisms moderate the R&D expenditures- the resource of internal funds relationship. The result showed that cash holdings have a positively relationship with R&D expenditures. Specially, we found that institutional ownership had a positive moderating effect of the R&D expenditures-the resource of internal funds relationship. In additional analysis, the large business group and the share of managers doesn’t moderate the relationship between cash holdings and R&D expenditures. These results provide that institutional investor in Korea tend to be long-term oriented, “active” and “sophisticated” investor. They are less likely to evaluate corporate executives on the basis of short-term earnings alone and are more likely to support value-creating.

Original languageEnglish
Pages (from-to)25-42
Number of pages18
JournalEurasian Business Review
Volume2
Issue number2
DOIs
StatePublished - 1 Dec 2012

Keywords

  • Cash Holdings
  • Ownership Mechanisms
  • Ownership tructure
  • R&D Expenditures
  • R&D Investments

Fingerprint

Dive into the research topics of 'The Relation between Cash Holdings and R&D Expenditures According to Ownership Structure'. Together they form a unique fingerprint.

Cite this