Missing R&D

• Autores: Ping-Sheng Koh, David M Reeb
• Localización: Journal of accounting and economics, ISSN 0165-4101, Vol. 60, Nº. 1, 2015, págs. 73-94
• Idioma: inglés
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• Resumen

  • We investigate whether missing R&D expenditures in financial statements indicates a lack of innovation activity. Patent records reveal that 10.5% of missing R&D firms file and receive patents, which is 14 times greater than zero R&D firms. Pseudo-Blank R&D firms (missing R&D firms with patent activity) demonstrate patent filings analogous to the bottom 90–95% of the positive R&D population. Multivariate difference-in-differences tests indicate that Pseudo-Blank R&D firms are more likely to report R&D after an exogenous auditor change. Finally, we provide simple Monte Carlo simulations to evaluate different methods to handle missing R&D in empirical research