Abstract

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.

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