Rich on Paper? Chinese Firms’ Academic Publications, Patents, and Market Value

48 Pages Posted: 9 Jan 2021

See all articles by David H. Hsu

David H. Hsu

University of Pennsylvania - Management Department

Po-Hsuan Hsu

National Tsing Hua University - Department of Quantitative Finance

Qifeng Zhao

Chinese Academy of Social Sciences (CASS) - Institute of Quantitative & Technical Economics

Date Written: November 19, 2020

Abstract

By combining various databases of academic publications and patents of China’s publicly listed firms, we explore the effects of academic publications on firm values and possible mechanisms. We find that Chinese firms’ academic publications are positively associated with their market valuation; more importantly, such a positive relation is more pronounced when these firms have stronger patent records, highlighting a synergy between basic research and applied technologies. Mechanism tests indicate that firm’s academic publications promote their market values through enhancing their human capital and sending credible signals to professional investors and the general public. Additional tests show that publications in English-language journals are more value-relevant than in Chinese-language journals.

Keywords: academic publications; firm value; technological innovation; patents; human capital

JEL Classification: O32 O34 G34 J24

Suggested Citation

Hsu, David H. and Hsu, Po-Hsuan and Zhao, Qifeng, Rich on Paper? Chinese Firms’ Academic Publications, Patents, and Market Value (November 19, 2020). Available at SSRN: https://ssrn.com/abstract=3733542 or http://dx.doi.org/10.2139/ssrn.3733542

David H. Hsu

University of Pennsylvania - Management Department ( email )

The Wharton School
Philadelphia, PA 19104-6370
United States
215-746-0125 (Phone)
215-898-0401 (Fax)

Po-Hsuan Hsu (Contact Author)

National Tsing Hua University - Department of Quantitative Finance ( email )

101, Section 2, Kuang-Fu Road
Hsinchu, Taiwan 300
China

Qifeng Zhao

Chinese Academy of Social Sciences (CASS) - Institute of Quantitative & Technical Economics ( email )

No.5 Jianguomennei dajie
Beijing 100732
China

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