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The Impact of Technological Capability on Financial Performance in the Semiconductor Industry

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  • Jun Hong Park

    (Graduate School of Management of Technology, Korea University, 145 Anam-ro, Seongbuk-gu, Seoul 02841, Korea)

  • Hyunseog Chung

    (Graduate School of Management of Technology, Korea University, 145 Anam-ro, Seongbuk-gu, Seoul 02841, Korea)

  • Ki Hong Kim

    (Department of Industrial and Management Engineering, Korea University, 145 Anam-ro, Seongbuk-gu, Seoul 02841, Korea)

  • Jin Ju Kim

    (Korea Institute of Energy Technology Evaluation and Planning, 14 Teheran-ro 114-gil, Gangnam-gu, Seoul 06175, Korea)

  • Chulung Lee

    (School of Industrial and Management Engineering, Korea University, 145 Anam-ro, Seongbuk-gu, Seoul 02841, Korea)

Abstract

The modern semiconductor industry is going through rapid changes as new markets and technologies appear. In this paper, such technology-intensive firms’ relationship between technological capability and financial performance is analyzed with regression analysis. Revenue and market capitalization are used as dependent variables. For the independent variables, the technological intensity, technological diversity, technological asset, and technological efficiency are used. The analysis results revealed different effects of technological capability on financial performance. Also, regression analysis is conducted by dividing firms into high and low groups based on technological asset and technological efficiency, and the analysis result revealed different effects of technological intensity and technological diversity on financial performance. For technological asset, the financial performance in the high group is affected more by technological intensity, and the financial performance in the low group is affected more by technological diversity. For technological efficiency, only the financial performance in the high group is affected by technological intensity. Although both groups’ financial performance is somewhat affected by technological diversity, there was no statistically significant differences between the groups. By separating the effect of technological capability on financial performance, this research can provide more detailed analysis results compared to previous literature and the methods of managing technological capability for semiconductor firms.

Suggested Citation

  • Jun Hong Park & Hyunseog Chung & Ki Hong Kim & Jin Ju Kim & Chulung Lee, 2021. "The Impact of Technological Capability on Financial Performance in the Semiconductor Industry," Sustainability, MDPI, vol. 13(2), pages 1-20, January.
    • Handle: RePEc:gam:jsusta:v:13:y:2021:i:2:p:489-:d:475838
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