earticle

영어

This paper, from the perspective of firm value and operating performance, analyzes the effect of captal, R&D, and advertising expenditures of the non‐financial firms listed on KOSPI and KOSDAQ market. We evaluate the relation between strategic investment choices measured at the time of going public on the improvement in IPO opreating performance and firm value through cross-sectional regression analysis. The primary findings of our study are summarized in the following way. Using a sample of nonfinancial firms listed on KOSPI and KOSDAQ market over the 1990~2007 period, the test results indicates that the firm valuation of the R&D investments and the capital expenditures increases critically on KOSPI market. Specifically, this paper finds that the coefficient associated with capital expenditures is 1.4791 significantly at 1 percent level, the coefficient associated with lag(capital expenditures) is 0.753 significantly at 1 percent level, and the coefficient associated with lag(R&D expenditures) is 2.306 significantly at 1 percent level. Our study suggests that the managers of IPO issuing firms carefully evaluate their resource allocation decisions during the process of preparing to go public since different areas of investment differ in terms of their impact on operating performance and firm value.