The Market Value of R&D, Patents, and Trademarks

SSRN Working Paper No. 1469705, submitted to an international journal

Abstract: The purpose of paper is to investigate the contribution of R&D investments, patents, and trademarks to the market valuations of companies using a Tobin’s q format. I employ non-linear least squares (NLLS) regression techniques to estimate the market valuation equation for 6 757 observations in the years 1996 to 2002. The results show that trademarks, which have rarely been examined in previous research, play an important role in determining company valuations. Indicators derived from publicly available trademark data are shown to reflect trademark value. Knowledge assets are also valued in financial markets, but patents need to be adjusted for their value to be informative. Trademark portfolios are found to represent 8.1% of the firm value, while patent portfolios capture 4.7% and R&D investments 19.9%.

Link: http://ssrn.com/abstract=1469705

Cite as: Sandner, P. (2009): The Market Value of R&D, Patents, and Trademarks, SSRN Working Paper No. 1469705, submitted to an international journal.