Who do you trust while Shares are on a Roler-Coaster Ride? Balance Sheet and Patent Data as Sources of Investor Information During Volatile Market Times
AbstractWe originally investigate the comparative usefulness of patent data as a source of investor information depending on the market cycle (bull/bear market). Based on comprehensive data for firms listed on German exchanges between 1997 and 2002, we demonstrate that patent data contain complementary explanatory power to accounting data irrespective of the standard used to prepare the financial statement (German GAAP, IAS and US GAAP). Moreover, we provide original evidence that only patent data are able to provide plausible investor information in both bull-market and bear-market periods, whereas accounting information overvalues intangible assets in bull markets and undervalues them in bears.
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Bibliographic InfoPaper provided by DRUID, Copenhagen Business School, Department of Industrial Economics and Strategy/Aalborg University, Department of Business Studies in its series DRUID Working Papers with number 05-15.
Date of creation: 2005
Date of revision:
Contact details of provider:
Web page: http://www.druid.dk/
Investor information; market value; patents;
Find related papers by JEL classification:
- D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
- G14 - Financial Economics - - General Financial Markets - - - Information and Market Efficiency; Event Studies; Insider Trading
- M41 - Business Administration and Business Economics; Marketing; Accounting - - Accounting - - - Accounting
- K11 - Law and Economics - - Basic Areas of Law - - - Property Law
This paper has been announced in the following NEP Reports:
- NEP-ALL-2005-10-15 (All new papers)
- NEP-CFN-2005-10-15 (Corporate Finance)
- NEP-FIN-2005-10-15 (Finance)
- NEP-FMK-2005-10-15 (Financial Markets)
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