Title: Intangible assets and market value of Japanese industries and firms

Authors: Pablo Gonzalo Ramirez; Toyohiko Hachiya

Addresses: Department of Industrial Engineering and Management, Tokyo Institute of Technology, 2-12-1 Ookayama Room 426, W9 Bldg., Meguro-ku, Tokyo 152-8550, Japan. ' Graduate School of Commerce and Management, Hitotsubashi University, 2-1 Naka, Kunitachi-shi, Tokyo 186-8601, Japan

Abstract: In this study, we examined whether the market value reflects the investment in intangible assets predicted by resource-based view (RBV) in a sample of public Japanese firms and industries. In particular, we tested whether the goodness of fit between prevailing industrial setting and firm's resource endowment is associated with market value. Our findings suggest that while some industries are more valuable than other, intangible assets are not a necessary condition. The results also indicate that while there exists a strong positive effect of R&D on Tobin's Q the evidence on the relationship between advertising and Tobin's Q is mixed. The results also show that firms investing higher levels of intangible assets in low intangible-settings are more valuable.

Keywords: resource-based view; RBV; resource endowment; firm value; Tobin's quotient; James Tobin; statistical ratios; market value; replacement value; physical assets; Tobin's Q; intangible assets; R&D; research and development; advertising intensity; intangibility; outperformers; Japan; public companies; industrial settings; goodness of fit; low intangible-settings; manufacturing industry; technology management.

DOI: 10.1504/IJTM.2012.047248

International Journal of Technology Management, 2012 Vol.59 No.1/2, pp.1 - 21

Available online: 13 Jun 2012 *

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