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Relationships Between Institutional Ownership, Capital Structure And Research And Development Investment

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Listed:
  • Hsueh-En Hsu
  • Chiulien C Venezia
  • Chelsea Schrader

Abstract

Research and development (R&D) is vital for an information technology (IT) firm’s innovation. This study investigates the relationship among institutional ownership, capital structure, and research and development investment for 336 listed information technology firms from 2006 to 2009. Empirical evidence shows that there is no significant relationship between institutional ownership and research and development investment. The finding suggests that institutional investors may not influence management decision making on research and development investment. This study also finds that capital structure has a negative relationship with research and development investment. The result indicates that information technology firms may use less debt when the investment outcome is uncertain.

Suggested Citation

  • Hsueh-En Hsu & Chiulien C Venezia & Chelsea Schrader, 2015. "Relationships Between Institutional Ownership, Capital Structure And Research And Development Investment," Accounting & Taxation, The Institute for Business and Finance Research, vol. 7(2), pages 75-82.
    • Handle: RePEc:ibf:acttax:v:7:y:2015:i:2:p:85-72
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    References listed on IDEAS

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    More about this item

    Keywords

    Research and Development; Institutional Ownership; Capital Structure; Information Technology;
    All these keywords.

    JEL classification:

    • M40 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - General
    • M49 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Other

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