IDEAS home Printed from https://ideas.repec.org/a/gam/jsusta/v9y2017i6p978-d101056.html
   My bibliography  Save this article

Does Implementation of Big Data Analytics Improve Firms’ Market Value? Investors’ Reaction in Stock Market

Author

Listed:
  • Hansol Lee

    (School of Business, Ewha Womans University, 52 Ewhayeodae-gil, Seodaemun-gu, Seoul 03760, Korea)

  • Eunkyung Kweon

    (School of Business, Ewha Womans University, 52 Ewhayeodae-gil, Seodaemun-gu, Seoul 03760, Korea)

  • Minkyun Kim

    (Sogang Business School, Sogang University, 35 Baekbum-ro, Mapo-gu, Seoul 04107, Korea)

  • Sangmi Chai

    (School of Business, Ewha Womans University, 52 Ewhayeodae-gil, Seodaemun-gu, Seoul 03760, Korea)

Abstract

Recently, due to the development of social media, multimedia, and the Internet of Things (IoT), various types of data have increased. As the existing data analytics tools cannot cover this huge volume of data, big data analytics becomes one of the emerging technologies for business today. Considering that big data analytics is an up-to-date term, in the present study, we investigated the impact of implementing big data analytics in the short-term perspective. We used an event study methodology to investigate the changes in stock price caused by announcements on big data analytics solution investment. A total of 54 investment announcements of firms publicly traded in NASDAQ and NYSE from 2010 to 2015 were collected. Our results empirically demonstrate that announcement of firms’ investment on big data solution leads to positive stock market reactions. In addition, we also found that investments on small vendors’ solution with industry-oriented functions tend to result in higher abnormal returns than those on big vendors’ solution with general functions. Finally, our results also suggest that stock market investors highly evaluate big data analytics investments of big firms as compared to those of small firms.

Suggested Citation

  • Hansol Lee & Eunkyung Kweon & Minkyun Kim & Sangmi Chai, 2017. "Does Implementation of Big Data Analytics Improve Firms’ Market Value? Investors’ Reaction in Stock Market," Sustainability, MDPI, vol. 9(6), pages 1-17, June.
    • Handle: RePEc:gam:jsusta:v:9:y:2017:i:6:p:978-:d:101056
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/2071-1050/9/6/978/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/2071-1050/9/6/978/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. David Hirshleifer & Tyler Shumway, 2003. "Good Day Sunshine: Stock Returns and the Weather," Journal of Finance, American Finance Association, vol. 58(3), pages 1009-1032, June.
    2. C. Ranganathan & Carol V. Brown, 2006. "ERP Investments and the Market Value of Firms: Toward an Understanding of Influential ERP Project Variables," Information Systems Research, INFORMS, vol. 17(2), pages 145-161, June.
    3. Krishna B. Kumar & Raghuram G. Rajan & Luigi Zingales, "undated". "What Determines Firm Size?," CRSP working papers 496, Center for Research in Security Prices, Graduate School of Business, University of Chicago.
    4. Kun Shin Im & Kevin E. Dow & Varun Grover, 2001. "Research Report: A Reexamination of IT Investment and the Market Value of the Firm—An Event Study Methodology," Information Systems Research, INFORMS, vol. 12(1), pages 103-117, March.
    5. Umble, Elisabeth J. & Haft, Ronald R. & Umble, M. Michael, 2003. "Enterprise resource planning: Implementation procedures and critical success factors," European Journal of Operational Research, Elsevier, vol. 146(2), pages 241-257, April.
    6. Mark J. Kamstra & Lisa A. Kramer & Maurice D. Levi, 2003. "Winter Blues: A SAD Stock Market Cycle," American Economic Review, American Economic Association, vol. 93(1), pages 324-343, March.
    7. Editorial Article, 0. "The Information for Authors," Economics of Contemporary Russia, Regional Public Organization for Assistance to the Development of Institutions of the Department of Economics of the Russian Academy of Sciences, issue 2.
    8. Konchitchki, Yaniv & O'Leary, Daniel E., 2011. "Event study methodologies in information systems research," International Journal of Accounting Information Systems, Elsevier, vol. 12(2), pages 99-115.
    9. Editorial Article, 0. "The Information for Authors," Economics of Contemporary Russia, Regional Public Organization for Assistance to the Development of Institutions of the Department of Economics of the Russian Academy of Sciences, issue 4.
    10. Editorial Article, 0. "The Information for Authors," Economics of Contemporary Russia, Regional Public Organization for Assistance to the Development of Institutions of the Department of Economics of the Russian Academy of Sciences, issue 3.
    11. Editorial Article, 0. "The Information for Authors," Economics of Contemporary Russia, Regional Public Organization for Assistance to the Development of Institutions of the Department of Economics of the Russian Academy of Sciences, issue 1.
    12. Editorial Article, 0. "The Information for Authors," Economics of Contemporary Russia, Regional Public Organization for Assistance to the Development of Institutions of the Department of Economics of the Russian Academy of Sciences, issue 4.
    13. Kaplanski, Guy & Levy, Haim, 2010. "Sentiment and stock prices: The case of aviation disasters," Journal of Financial Economics, Elsevier, vol. 95(2), pages 174-201, February.
    14. Armitage, Seth, 1995. "Event Study Methods and Evidence on Their Performance," Journal of Economic Surveys, Wiley Blackwell, vol. 9(1), pages 25-52, March.
    15. Fama, Eugene F, et al, 1969. "The Adjustment of Stock Prices to New Information," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 10(1), pages 1-21, February.
    16. Brown, Stephen J. & Warner, Jerold B., 1985. "Using daily stock returns : The case of event studies," Journal of Financial Economics, Elsevier, vol. 14(1), pages 3-31, March.
    17. Alex Edmans & Diego García & Øyvind Norli, 2007. "Sports Sentiment and Stock Returns," Journal of Finance, American Finance Association, vol. 62(4), pages 1967-1998, August.
    18. Editorial Article, 0. "The Information for Authors," Economics of Contemporary Russia, Regional Public Organization for Assistance to the Development of Institutions of the Department of Economics of the Russian Academy of Sciences, issue 3.
    19. Editorial Article, 0. "The Information for Authors," Economics of Contemporary Russia, Regional Public Organization for Assistance to the Development of Institutions of the Department of Economics of the Russian Academy of Sciences, issue 2.
    20. A. Craig MacKinlay, 1997. "Event Studies in Economics and Finance," Journal of Economic Literature, American Economic Association, vol. 35(1), pages 13-39, March.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Maria Cleofe Giorgino & Enrico Supino & Federico Barnabè, 2017. "Corporate Disclosure, Materiality, and Integrated Report: An Event Study Analysis," Sustainability, MDPI, vol. 9(12), pages 1-15, November.
    2. Akca Yasar & Gokhan Ozer, 2016. "Determination the Factors that Affect the Use of Enterprise Resource Planning Information System through Technology Acceptance Model," International Journal of Business and Management, Canadian Center of Science and Education, vol. 11(10), pages 1-91, September.
    3. Kritana Prueksakorn & Cheng-Xu Piao & Hyunchul Ha & Taehyeung Kim, 2015. "Computational and Experimental Investigation for an Optimal Design of Industrial Windows to Allow Natural Ventilation during Wind-Driven Rain," Sustainability, MDPI, vol. 7(8), pages 1-22, August.
    4. Hualin Xie & Jinlang Zou & Hailing Jiang & Ning Zhang & Yongrok Choi, 2014. "Spatiotemporal Pattern and Driving Forces of Arable Land-Use Intensity in China: Toward Sustainable Land Management Using Emergy Analysis," Sustainability, MDPI, vol. 6(6), pages 1-17, May.
    5. Stephan E. Maurer & Andrei V. Potlogea, 2021. "Male‐biased Demand Shocks and Women's Labour Force Participation: Evidence from Large Oil Field Discoveries," Economica, London School of Economics and Political Science, vol. 88(349), pages 167-188, January.
    6. Tie Hua Zhou & Ling Wang & Keun Ho Ryu, 2015. "Supporting Keyword Search for Image Retrieval with Integration of Probabilistic Annotation," Sustainability, MDPI, vol. 7(5), pages 1-18, May.
    7. T. Karski, 2019. "Opinions and Controversies in Problem of The So-Called Idiopathic Scoliosis. Information About Etiology, New Classification and New Therapy," Biomedical Journal of Scientific & Technical Research, Biomedical Research Network+, LLC, vol. 12(5), pages 9612-9616, January.
    8. Sung-Won Park & Sung-Yong Son, 2017. "Cost Analysis for a Hybrid Advanced Metering Infrastructure in Korea," Energies, MDPI, vol. 10(9), pages 1-18, September.
    9. Wesley Mendes-da-Silva, 2020. "What Makes an Article be More Cited?," RAC - Revista de Administração Contemporânea (Journal of Contemporary Administration), ANPAD - Associação Nacional de Pós-Graduação e Pesquisa em Administração, vol. 24(6), pages 507-513.
    10. Martin Valtierra-Rodriguez & Juan Pablo Amezquita-Sanchez & Arturo Garcia-Perez & David Camarena-Martinez, 2019. "Complete Ensemble Empirical Mode Decomposition on FPGA for Condition Monitoring of Broken Bars in Induction Motors," Mathematics, MDPI, vol. 7(9), pages 1-19, August.
    11. Julián Miranda & Angélica Flórez & Gustavo Ospina & Ciro Gamboa & Carlos Flórez & Miguel Altuve, 2020. "Proposal for a System Model for Offline Seismic Event Detection in Colombia," Future Internet, MDPI, vol. 12(12), pages 1-17, December.
    12. Wisdom Akpalu & Mintewab Bezabih, 2015. "Tenure Insecurity, Climate Variability and Renting out Decisions among Female Small-Holder Farmers in Ethiopia," Sustainability, MDPI, vol. 7(6), pages 1-16, June.
    13. Wei Chen & Shu-Yu Liu & Chih-Han Chen & Yi-Shan Lee, 2011. "Bounded Memory, Inertia, Sampling and Weighting Model for Market Entry Games," Games, MDPI, vol. 2(1), pages 1-13, March.
    14. David Harborth & Sebastian Pape, 2020. "Empirically Investigating Extraneous Influences on the “APCO” Model—Childhood Brand Nostalgia and the Positivity Bias," Future Internet, MDPI, vol. 12(12), pages 1-16, December.
    15. Ping Wang & Jie Wang & Guiwu Wei & Cun Wei, 2019. "Similarity Measures of q-Rung Orthopair Fuzzy Sets Based on Cosine Function and Their Applications," Mathematics, MDPI, vol. 7(4), pages 1-23, April.
    16. Peterson, Willis L., 1973. "Publication Productivities Of U.S. Economics Department Graduates," Staff Papers 14105, University of Minnesota, Department of Applied Economics.
    17. Taeyeoun Roh & Yujin Jeong & Byungun Yoon, 2017. "Developing a Methodology of Structuring and Layering Technological Information in Patent Documents through Natural Language Processing," Sustainability, MDPI, vol. 9(11), pages 1-19, November.
    18. He-Yau Kang & Amy H. I. Lee & Tzu-Ting Huang, 2016. "Project Management for a Wind Turbine Construction by Applying Fuzzy Multiple Objective Linear Programming Models," Energies, MDPI, vol. 9(12), pages 1-15, December.
    19. Vasilyeva, Olga, 2021. "Agro-food clusters in the Republic of Kazakhstan: assessment and prospects of development," Economic Consultant, Roman I. Ostapenko, vol. 34(2), pages 13-20.
    20. Chris Lytridis & Anna Lekova & Christos Bazinas & Michail Manios & Vassilis G. Kaburlasos, 2020. "WINkNN: Windowed Intervals’ Number kNN Classifier for Efficient Time-Series Applications," Mathematics, MDPI, vol. 8(3), pages 1-14, March.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gam:jsusta:v:9:y:2017:i:6:p:978-:d:101056. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.