DETERMINING THE RELATIONSHIP BETWEEN FINANCIAL SLACK AND R&D INVESTMENTS: SAMPLE OF BIST MANUFACTURING SECTOR
Year 2024,
Issue: 64, 185 - 198, 20.09.2024
Emrah Şahin
,
Fazlı Irmak
Abstract
Financial slack is the sum of a firm's highly liquid assets and its ability to borrow. In the literature, it is claimed that firms with high financial slack can afford to try new strategies such as introducing new products to the market and entering new markets. In this study, in order to determine the effect of financial slack on R&D investments, the financial data of firms in the BIST Manufacturing Sector between 2018/Q1- 2023/Q3 periods are analysed. In the study, current, recoverable and potential slack types representing financial slack are considered as independent variables, while R&D intensity is taken as the dependent variable. In line with the objectives of the study, the existence of a linear or curvilinear relationship between slack types and R&D investments is analysed by regression method. According to the analysis results, a positive linear relationship was determined between available and potential slack and R&D intensity, and an inverted U-shaped curvilinear relationship was determined between recoverable slack and R&D intensity. This result obtained for the available slack partially supports the claims of behavioral theorists, while this result obtained for the recoverable slack is in full compliance with the claims of behavioral theorists. The result obtained for the potential slack is positive linear, contrary to the claims of behavioral theorists.
Ethical Statement
The authors of this article confirm that their work complies with the principles of research and publication ethics
Supporting Institution
There is no supporting organisation.
Thanks
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References
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- Ashwin, A. S., Krishnan, R. T., ve George, R. (2016). Board characteristics, financial slack and R&D investments: an empirical analysis of the Indian pharmaceutical industry. International Studies of Management & Organization, 46(1), 8-23. https://doi.org/10.1080/00208825.2015.1007007.
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- Bourgeois, L. J. (1981). On the Measurement of Organizational Slack. Academy of Management Review. 6(1): 29-39. https://doi.org/10.5465/amr.1981.4287985
- Bradley, S. W., Shepherd, D. A., & Wiklund, J. (2011). The importance of slack for new organizations facing ‘tough’environments. Journal of Management Studies, 48(5), 1071-1097. https://doi.org/10.1111/j.1467-6486.2009.00906.x.
- Bromiley, P. (1991). Testing a causal model of corporate risk taking and performance. Academy of Management journal, 34(1), 37-59. https://doi.org/10.5465/256301.
- Chandler, L. L. (2008). The multiple dimensions of slack: Effects on innovation and firm performance during environmental shock (Yayınlanmamış Doktora Tezi). Nova Southeastern University.
- Chen, Y. (2011). Ownership structure, financial structure and R&D investments: Evidence from Korean firms (Yayınlanmamış Doktora Tezi). Singapore Management University.
- Chiu, Y. C., ve Liaw, Y. C. (2009). Organizational slack: is more or less better?. Journal of Organizational Change Management, 22(3), 321-342. https://doi.org/10.1108/09534810910951104.
- Cyert, R. M., ve J. G. March. (1963). A Behavioral Theory of the Firm. Englewood Cliffs, NJ: Prentice-Hall.
- Du, Y., Kim, P. H., Fourne, S. P., ve Wang, X. (2022). In times of plenty: Slack resources, R&D investment, and entrepreneurial firms in challenging institutional environments. Journal of Business Research, 145, 360-376. https://doi.org/10.1016/j.jbusres.2022.03.004.
- Geiger, S. W., ve Cashen, L. H. (2002). A multidimensional examination of slack and its impact on innovation. Journal of Managerial issues, 14(1), 68-84.
- Hailu, D. H., Wang, M., Molla Ayalew, M., ve Dagnew Dinberu, Y. (2018). Financial slack and firm performance in Africa: The mediating effects of the banking sector and stock market development. Global Journal of
Management and Business Research. 18(7), 30-47. https://www.jstor.org/stable/40604374.
- Herold, D. M., Jayaraman, N., ve Narayanaswamy, C. R. (2006). What is the relationship between organizational slack and innovation?. Journal of Managerial Issues, 372-392. https://www.jstor.org/stable/40604546.
- Kılıç, M. (2020). BIST bilişim sektöründeki firmaların Ar-Ge harcamalarının finansal performans üzerindeki etkisi. Erciyes Üniversitesi Sosyal Bilimler Enstitüsü Dergisi, (49), 219-234.
- Kılıç, C., Bayar, Y., ve Özekicioğlu, H. (2014). Araştırma geliştirme harcamalarının yüksek teknoloji ürün ihracat üzerindeki etkisi: G–8 ülkeleri için bir panel veri analizi. Erciyes Üniversitesi İktisadi ve İdari Bilimler Fakültesi Dergisi, (44), 115-130.
- Kim, B. N., Lee, N. S., Wi, J. H., ve Lee, J. K. (2017). The effects of slack resources on firm performance and innovation in the Korean pharmaceutical industry. Asian Journal of Technology Innovation, 25(3), 387-406. https://doi.org/10.1080/19761597.2018.1434007.
- Kim, H., Kim, H., ve Lee, P. M. (2008). Ownership structure and the relationship between financial slack and R&D investments: Evidence from Korean firms. Organization Science, 19(3), 404-418. https://doi.org/10.1287/orsc.1080.0360.
- Korkmaz, S. (2010). Türkiye’de Ar-Ge yatırımları ve ekonomik büyüme arasındaki ilişkinin var modeli ile analizi. Yaşar Üniversitesi E-Dergisi, 5(20), 3320-3330.
- Lee, C. L., ve Wu, H. C. (2016). How do slack resources affect the relationship between R&D expenditures and firm performance?. R&D Management, 46(S3), 958-978. https://doi.org/10.1111/radm.12141.
- Lee, S. (2011). How financial slack affects firm performance: Evidence from US industrial firms. Journal of Economic Research (JER), 16(1), 1-27.
- Lee, S. (2012). Corporate governance, financial slack and firm performance: A comparative study between US and UK. Seoul Journal of Business, 18(1), 3-23.
- Lee, S. (2015). Slack and innovation: Investigating the relationship in Korea. Journal of Business Research, 68(9), 1895-1905. https://doi.org/10.1016/j.jbusres.2014.12.009.
- Leyva-de la Hiz, D. I., Ferron-Vilchez, V., ve Aragon-Correa, J. A. (2019). Do firms’ slack resources influence the relationship between focused environmental innovations and financial performance? More is not always better. Journal of Business Ethics, 159, 1215-1227.
- Lu, L. H., ve Wong, P. K. (2019). Performance feedback, financial slack and the innovation behavior of firms. Asia Pacific Journal of Management, 36, 1079-1109.
- Lungeanu, R., Stern, I., ve Zajac, E. J. (2016). When do firms change technology‐sourcing vehicles? The role of poor innovative performance and financial slack. Strategic management journal, 37(5), 855-869. https://doi.org/10.1002/smj.2371.
- Marlin, D. (2014). Industry influences on organizational slack. Journal of Business & Economics Research (JBER), 12(1), 23-28. https://doi.org/10.19030/jber.v12i1.8373.
- Marlin, D., ve Geiger, S. W. (2015). The organizational slack and performance relationship: A configurational approach. Management Decision, 53(10), 2339-2355. https://doi.org/10.1108/MD-03-2015-0100.
- Morgheim, S.M. (2015). Assessing The Relationship Between Financial Slack And Financial Corporation Performance. (Published Doctoral Dissertation). Arizona: Northcentral University.
- Moses, O. D. (1992). Organizational slack and risk‐taking behaviour: Tests of product pricing strategy. Journal of Organizational Change Management, 5(3), 38-54. https://doi.org/10.1108/09534819210018045.
- Nohria, N., ve Gulati, R. (1996). Is slack good or bad for innovation?. Academy of Management Journal. 39(5), 1245-1264. https://doi.org/10.5465/256998.
- O'brien, J. P. (2003). The capital structure implications of pursuing a strategy of innovation. Strategic Management Journal. 24(5), 415-431. https://doi.org/10.1002/smj.308.
- Othman, R., & Ameer, R. (2009). Determinants and persistence of research and development investments: Evidence from Malaysia. International Journal of Emerging Markets, 4(3), 275-292.
- Rafailov, D. (2017). Financial slack and performance of Bulgarian firms. Journal of Finance and Bank Management, 5(2), 1-13. https://doi.org/10.15640/jfbm.v5n2a1.
- Shaikh, I. A., O'Brien, J. P., ve Peters, L. (2018). Inside directors and the underinvestment of financial slack towards R&D-intensity in high-technology firms. Journal of Business Research, 82, 192-201. https://doi.org/10.1016/j.jbusres.2017.09.014.
- Şahin, E., ve Karaca S. S., (2024). Finansal Gevşekliğin Firma Performansına Etkisi: 2008 Finansal Krizi. Konya: Çizgi Kitabevi. Elde edilme tarihi: 20 Mart
- Taban, S., ve Şengür, M. (2014). Türkiye’de Ar-Ge ve ekonomik büyüme. AİBÜ Sosyal Bilimler Enstitüsü Dergisi, 14(1), 355-376.
- Tatoğlu, F.Y. (2018). Panel veri ekonometrisi. 4. Baskı, Beta, İstanbul.
- Terry Mousa, F., ve Chowdhury, J. (2014). The relationship between organizational slack and innovation: Revisited. American Journal of Business, 29(1), 26-42. https://doi.org/10.1108/AJB-06-2013-0036.
- Wu, J., ve Tu, R. (2007). CEO stock option pay and R&D spending: a behavioral agency explanation. Journal of Business Research, 60(5), 482-492. https://doi.org/10.1016/j.jbusres.2006.12.006.
- Zhang, K., Wang, J. J., Sun, Y., ve Hossain, S. (2021). Financial slack, institutional shareholding and enterprise innovation investment: evidence from China. Accounting & Finance, 61(2), 3235-3259. https://doi.org/10.1111/acfi.12700.
- Zona, F. (2012). Corporate investing as a response to economic downturn: Prospect theory, the behavioural agency model and the role of financial slack. British Journal of Management, 23, S42-S57. https://doi.org/10.1111/j.1467-8551.2012.00818.x.
FİNANSAL GEVŞEKLİK İLE AR-GE YATIRIMLARI ARASINDAKİ İLİŞKİNİN BELİRLENMESİ: BİST İMALAT SEKTÖRÜ ÖRNEĞİ
Year 2024,
Issue: 64, 185 - 198, 20.09.2024
Emrah Şahin
,
Fazlı Irmak
Abstract
Finansal gevşeklik, bir firmanın sahip olduğu likiditesi yüksek varlıklar ile borçlanabilme yeteneğinin toplamından oluşmaktadır. Literatürde, finansal gevşekliği yüksek olan firmaların piyasaya yeni ürünler sunmak, yeni pazarlara girmek gibi yeni stratejiler deneme gücünün yetebileceği iddia edilmektedir. Bu çalışmada, finansal gevşeklik ile Ar-Ge yatırımları arasındaki ilişkiyi belirlemek üzere BİST İmalat Sektöründe yer alan firmaların 2018/Q1- 2023/Q3 dönemleri arasındaki mali verileri analiz edilmiştir. Çalışmada finansal gevşekliği temsil eden mevcut, geri kazanılabilir ve potansiyel gevşeklik türleri bağımsız, Ar-Ge yoğunluğu ise bağımlı değişken olarak ele alınmıştır. Çalışmanın amaçlarına uygun olarak gevşeklik türleri ile Ar-Ge yatırımları arasındaki doğrusal ya da eğrisel ilişkinin varlığı regresyon yöntemi ile incelenmiştir. Analiz sonuçlarına göre, mevcut ve potansiyel gevşeklik ile Ar-Ge yoğunluğu arasında pozitif doğrusal, geri kazanılabilir gevşeklik ile Ar-Ge yoğunluğu arasında ters U şeklinde eğrisel ilişki tespit edilmiştir. Mevcut gevşeklik için elde edilen bu sonuç, davranışsal teorisyenlerin iddialarını kısmen desteklerken, geri kazanılabilir gevşeklik için elde edilen bu sonuç, davranışsal teorisyenlerin iddiaları ile birebir uyumludur. Potansiyel gevşeklik için elde edilen sonuç, davranışsal teorisyenlerin iddialarının aksine pozitif doğrusaldır.
Ethical Statement
Bu çalışmanın yazarları, araştırma ve yayın etiği ilkelerine uyduklarını kabul etmektedir
Supporting Institution
Destekleyen kurum bulunmamaktadır.
Thanks
Destek ve katkılarınız için şimdiden teşekkürlerimizi sunarız.
References
- Alessandri, T. M., ve Pattit, J. M. (2014). “Drivers of R&D investment: The interaction of behavioral theory and managerial incentives”. Journal of Business Research, 67(2), 151-158. https://doi.org/10.1016/j.jbusres.2012.11.001.
- Ashwin, A. S., Krishnan, R. T., ve George, R. (2016). Board characteristics, financial slack and R&D investments: an empirical analysis of the Indian pharmaceutical industry. International Studies of Management & Organization, 46(1), 8-23. https://doi.org/10.1080/00208825.2015.1007007.
- Baloc, R. A., Sha, N., ve Panhwar, K. N. (2014). The relationship of slack resources with subjective wellbeing at work: empirical study of sugar mills from Pakistan. International Strategic Management Review, 2(2), 89-97. https://doi.org/10.1016/j.ism.2014.10.002.
- Bourgeois, L. J. (1981). On the Measurement of Organizational Slack. Academy of Management Review. 6(1): 29-39. https://doi.org/10.5465/amr.1981.4287985
- Bradley, S. W., Shepherd, D. A., & Wiklund, J. (2011). The importance of slack for new organizations facing ‘tough’environments. Journal of Management Studies, 48(5), 1071-1097. https://doi.org/10.1111/j.1467-6486.2009.00906.x.
- Bromiley, P. (1991). Testing a causal model of corporate risk taking and performance. Academy of Management journal, 34(1), 37-59. https://doi.org/10.5465/256301.
- Chandler, L. L. (2008). The multiple dimensions of slack: Effects on innovation and firm performance during environmental shock (Yayınlanmamış Doktora Tezi). Nova Southeastern University.
- Chen, Y. (2011). Ownership structure, financial structure and R&D investments: Evidence from Korean firms (Yayınlanmamış Doktora Tezi). Singapore Management University.
- Chiu, Y. C., ve Liaw, Y. C. (2009). Organizational slack: is more or less better?. Journal of Organizational Change Management, 22(3), 321-342. https://doi.org/10.1108/09534810910951104.
- Cyert, R. M., ve J. G. March. (1963). A Behavioral Theory of the Firm. Englewood Cliffs, NJ: Prentice-Hall.
- Du, Y., Kim, P. H., Fourne, S. P., ve Wang, X. (2022). In times of plenty: Slack resources, R&D investment, and entrepreneurial firms in challenging institutional environments. Journal of Business Research, 145, 360-376. https://doi.org/10.1016/j.jbusres.2022.03.004.
- Geiger, S. W., ve Cashen, L. H. (2002). A multidimensional examination of slack and its impact on innovation. Journal of Managerial issues, 14(1), 68-84.
- Hailu, D. H., Wang, M., Molla Ayalew, M., ve Dagnew Dinberu, Y. (2018). Financial slack and firm performance in Africa: The mediating effects of the banking sector and stock market development. Global Journal of
Management and Business Research. 18(7), 30-47. https://www.jstor.org/stable/40604374.
- Herold, D. M., Jayaraman, N., ve Narayanaswamy, C. R. (2006). What is the relationship between organizational slack and innovation?. Journal of Managerial Issues, 372-392. https://www.jstor.org/stable/40604546.
- Kılıç, M. (2020). BIST bilişim sektöründeki firmaların Ar-Ge harcamalarının finansal performans üzerindeki etkisi. Erciyes Üniversitesi Sosyal Bilimler Enstitüsü Dergisi, (49), 219-234.
- Kılıç, C., Bayar, Y., ve Özekicioğlu, H. (2014). Araştırma geliştirme harcamalarının yüksek teknoloji ürün ihracat üzerindeki etkisi: G–8 ülkeleri için bir panel veri analizi. Erciyes Üniversitesi İktisadi ve İdari Bilimler Fakültesi Dergisi, (44), 115-130.
- Kim, B. N., Lee, N. S., Wi, J. H., ve Lee, J. K. (2017). The effects of slack resources on firm performance and innovation in the Korean pharmaceutical industry. Asian Journal of Technology Innovation, 25(3), 387-406. https://doi.org/10.1080/19761597.2018.1434007.
- Kim, H., Kim, H., ve Lee, P. M. (2008). Ownership structure and the relationship between financial slack and R&D investments: Evidence from Korean firms. Organization Science, 19(3), 404-418. https://doi.org/10.1287/orsc.1080.0360.
- Korkmaz, S. (2010). Türkiye’de Ar-Ge yatırımları ve ekonomik büyüme arasındaki ilişkinin var modeli ile analizi. Yaşar Üniversitesi E-Dergisi, 5(20), 3320-3330.
- Lee, C. L., ve Wu, H. C. (2016). How do slack resources affect the relationship between R&D expenditures and firm performance?. R&D Management, 46(S3), 958-978. https://doi.org/10.1111/radm.12141.
- Lee, S. (2011). How financial slack affects firm performance: Evidence from US industrial firms. Journal of Economic Research (JER), 16(1), 1-27.
- Lee, S. (2012). Corporate governance, financial slack and firm performance: A comparative study between US and UK. Seoul Journal of Business, 18(1), 3-23.
- Lee, S. (2015). Slack and innovation: Investigating the relationship in Korea. Journal of Business Research, 68(9), 1895-1905. https://doi.org/10.1016/j.jbusres.2014.12.009.
- Leyva-de la Hiz, D. I., Ferron-Vilchez, V., ve Aragon-Correa, J. A. (2019). Do firms’ slack resources influence the relationship between focused environmental innovations and financial performance? More is not always better. Journal of Business Ethics, 159, 1215-1227.
- Lu, L. H., ve Wong, P. K. (2019). Performance feedback, financial slack and the innovation behavior of firms. Asia Pacific Journal of Management, 36, 1079-1109.
- Lungeanu, R., Stern, I., ve Zajac, E. J. (2016). When do firms change technology‐sourcing vehicles? The role of poor innovative performance and financial slack. Strategic management journal, 37(5), 855-869. https://doi.org/10.1002/smj.2371.
- Marlin, D. (2014). Industry influences on organizational slack. Journal of Business & Economics Research (JBER), 12(1), 23-28. https://doi.org/10.19030/jber.v12i1.8373.
- Marlin, D., ve Geiger, S. W. (2015). The organizational slack and performance relationship: A configurational approach. Management Decision, 53(10), 2339-2355. https://doi.org/10.1108/MD-03-2015-0100.
- Morgheim, S.M. (2015). Assessing The Relationship Between Financial Slack And Financial Corporation Performance. (Published Doctoral Dissertation). Arizona: Northcentral University.
- Moses, O. D. (1992). Organizational slack and risk‐taking behaviour: Tests of product pricing strategy. Journal of Organizational Change Management, 5(3), 38-54. https://doi.org/10.1108/09534819210018045.
- Nohria, N., ve Gulati, R. (1996). Is slack good or bad for innovation?. Academy of Management Journal. 39(5), 1245-1264. https://doi.org/10.5465/256998.
- O'brien, J. P. (2003). The capital structure implications of pursuing a strategy of innovation. Strategic Management Journal. 24(5), 415-431. https://doi.org/10.1002/smj.308.
- Othman, R., & Ameer, R. (2009). Determinants and persistence of research and development investments: Evidence from Malaysia. International Journal of Emerging Markets, 4(3), 275-292.
- Rafailov, D. (2017). Financial slack and performance of Bulgarian firms. Journal of Finance and Bank Management, 5(2), 1-13. https://doi.org/10.15640/jfbm.v5n2a1.
- Shaikh, I. A., O'Brien, J. P., ve Peters, L. (2018). Inside directors and the underinvestment of financial slack towards R&D-intensity in high-technology firms. Journal of Business Research, 82, 192-201. https://doi.org/10.1016/j.jbusres.2017.09.014.
- Şahin, E., ve Karaca S. S., (2024). Finansal Gevşekliğin Firma Performansına Etkisi: 2008 Finansal Krizi. Konya: Çizgi Kitabevi. Elde edilme tarihi: 20 Mart
- Taban, S., ve Şengür, M. (2014). Türkiye’de Ar-Ge ve ekonomik büyüme. AİBÜ Sosyal Bilimler Enstitüsü Dergisi, 14(1), 355-376.
- Tatoğlu, F.Y. (2018). Panel veri ekonometrisi. 4. Baskı, Beta, İstanbul.
- Terry Mousa, F., ve Chowdhury, J. (2014). The relationship between organizational slack and innovation: Revisited. American Journal of Business, 29(1), 26-42. https://doi.org/10.1108/AJB-06-2013-0036.
- Wu, J., ve Tu, R. (2007). CEO stock option pay and R&D spending: a behavioral agency explanation. Journal of Business Research, 60(5), 482-492. https://doi.org/10.1016/j.jbusres.2006.12.006.
- Zhang, K., Wang, J. J., Sun, Y., ve Hossain, S. (2021). Financial slack, institutional shareholding and enterprise innovation investment: evidence from China. Accounting & Finance, 61(2), 3235-3259. https://doi.org/10.1111/acfi.12700.
- Zona, F. (2012). Corporate investing as a response to economic downturn: Prospect theory, the behavioural agency model and the role of financial slack. British Journal of Management, 23, S42-S57. https://doi.org/10.1111/j.1467-8551.2012.00818.x.