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Do Personal Data Related Innovation Boost Firm Value?

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  • Koski, Heli

Abstract

Personal data is increasingly used in business value creation. Data from the years 2007–2014 suggest that firms’ personal data related innovations and knowledge stocks in technology domains of location-based services and artificial intelligence contributed substantially to firm value. The premiums gained from personal data related innovation were particularly significant for data giants holding knowledge stocks in the location-based service domain. Empirical findings indicate that a strong positive relationship between personal data related knowledge stocks of the location-based services domain and firm value relates primarily to investor attention intensified during periods of media hype. The data provide new insights into the market valuation of intangible assets: investors seem to overweight more salient right tails of firms’ knowledge stocks of emerging technologies while neglecting salient left tails.

Suggested Citation

  • Koski, Heli, 2018. "Do Personal Data Related Innovation Boost Firm Value?," ETLA Brief 66, The Research Institute of the Finnish Economy.
    • Handle: RePEc:rif:briefs:66
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    More about this item

    Keywords

    Firm value; data economy; personal data; innovation; investor attention; technology salience;
    All these keywords.

    JEL classification:

    • D22 - Microeconomics - - Production and Organizations - - - Firm Behavior: Empirical Analysis
    • G41 - Financial Economics - - Behavioral Finance - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making in Financial Markets
    • L2 - Industrial Organization - - Firm Objectives, Organization, and Behavior
    • O3 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights

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