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R&D and firm performance in the semiconductor industry
- Source :
- Industry and Innovation. 24:280-297
- Publication Year :
- 2016
- Publisher :
- Informa UK Limited, 2016.
-
Abstract
- While the semiconductor industry is still dominated by large vertically integrated firms, fabless firms, which outsource their manufacturing, are gaining market share. Fabless firms are considered to have an advantage in product innovation, as they can focus their innovation efforts on chip design and can benefit from investments in process innovation made by their manufacturing partners. However, there is little empirical evidence of the performance of fabless firms compared to vertically integrated firms. This research empirically examines the relationship between R&D and the financial performance of fabless and vertically integrated firms from 2000 to 2010. Our results show that fabless firms maintain higher gross and net margins, earn a higher return on assets (ROA) and have greater intangible value (Tobin’s q) than vertically integrated firms when controlling for size, capital intensity and R&D ratio (R&D/sales). This supports the argument that fabless firms achieve greater performance by foc...
- Subjects :
- Finance
Return on assets
Product innovation
business.industry
05 social sciences
General Business, Management and Accounting
Vertical integration
Outsourcing
Vertical disintegration
Management of Technology and Innovation
0502 economics and business
Capital intensity
Business
050207 economics
Market share
Empirical evidence
050203 business & management
Industrial organization
Subjects
Details
- ISSN :
- 14698390 and 13662716
- Volume :
- 24
- Database :
- OpenAIRE
- Journal :
- Industry and Innovation
- Accession number :
- edsair.doi...........4272a4d0951a4186331b141c69ee7067