Market value, R&D and intellectual property: An empirical analysis of large Australian firms

This paper considers the value of innovation to large Australian firms. Spe cifically, we investigate how R&D and intellectual property activity influe nces the market value of firms, using a Tobin's q approach. R&D data are av ailable for the period 1994-96 and data on patent, trade mark and design ap plications for 1996. The findings suggest that R&D and patent activity are positively and significantly associated with market value. The results also suggest that private returns to R&D in Australia are low by international standards.