Year 2019, Volume 6, Issue 1, Pages 46 - 67 2019-03-30

DOES PATENT CONTRIBUTE TO STOCK PRICE IN CHINA?

Tsui-Min Chen [1] , Chiu-Chi Wei [2] , Hui-Chung Che [3]

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Purpone - Along with the in-depth implementation of national intellectual property strategies in China, China’s intellectual property law has been fully integrated with international norms. The number of patents in China is among the highest in the world and China has been the country with the largest number of patent applications in the world for five consecutive years. In addition, the incentive and protective role of the intellectual property system on economy, science, technology and culture has emerged.

Methodology - There are more than 3,000 A-share listed companies in mainland China, as the second largest stock market among global transactions, with the daily trading volume exceeding one trillion RMB. Its ups and downs are catching the eyes of global investors. Patents are the concrete manifestations of scientific and technological innovations. It is questionable if this specific performance can contribute to financial performance and if investment potential stocks can be exploited through patent indicators. In view of this, in this study, an empirical research was conducted on the data of the technology-based enterprises listed on the Shanghai A-share market from 2011 to 2017.

Findings - It is found in this study that, compared to stock prices, there is a significant leading period of specific patent indicators for more than one year. After the data back-testing of the stock exchange, the average performance of the investment potential stocks selected based on this research model is better than the market index performance.

Conclusion - Though the statistical test and time series algorithm of patent indicators, the leading patent formulas are deduced in this study, which can validly predict the stock price of listed companies and the lead period is up to one year, at least a quarter with predictive accuracy.

Patent, patent indicator, stock price, forecasts, panel data, Granger causality test
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Primary Language en
Subjects Management, Humanities, Multidisciplinary, Information Science and Library Science, Social, Behavioral Sciences, Ethics, Industrial Relations and Labor, Education and Educational Research
Journal Section Articles
Authors

Orcid: 0000-0003-0617-8902
Author: Tsui-Min Chen (Primary Author)

Orcid: 0000-0002-9433-9114
Author: Chiu-Chi Wei

Orcid: 0000-0003-2873-1510
Author: Hui-Chung Che

Bibtex @research article { rjbm543964, journal = {Research Journal of Business and Management}, issn = {}, eissn = {2148-6689}, address = {PressAcademia}, year = {2019}, volume = {6}, pages = {46 - 67}, doi = {10.17261/Pressacademia.2019.1021}, title = {DOES PATENT CONTRIBUTE TO STOCK PRICE IN CHINA?}, key = {cite}, author = {Chen, Tsui-Min and Wei, Chiu-Chi and Che, Hui-Chung} }
APA Chen, T , Wei, C , Che, H . (2019). DOES PATENT CONTRIBUTE TO STOCK PRICE IN CHINA?. Research Journal of Business and Management, 6 (1), 46-67. DOI: 10.17261/Pressacademia.2019.1021
MLA Chen, T , Wei, C , Che, H . "DOES PATENT CONTRIBUTE TO STOCK PRICE IN CHINA?". Research Journal of Business and Management 6 (2019): 46-67 <http://dergipark.org.tr/rjbm/issue/44112/543964>
Chicago Chen, T , Wei, C , Che, H . "DOES PATENT CONTRIBUTE TO STOCK PRICE IN CHINA?". Research Journal of Business and Management 6 (2019): 46-67
RIS TY - JOUR T1 - DOES PATENT CONTRIBUTE TO STOCK PRICE IN CHINA? AU - Tsui-Min Chen , Chiu-Chi Wei , Hui-Chung Che Y1 - 2019 PY - 2019 N1 - doi: 10.17261/Pressacademia.2019.1021 DO - 10.17261/Pressacademia.2019.1021 T2 - Research Journal of Business and Management JF - Journal JO - JOR SP - 46 EP - 67 VL - 6 IS - 1 SN - -2148-6689 M3 - doi: 10.17261/Pressacademia.2019.1021 UR - https://doi.org/10.17261/Pressacademia.2019.1021 Y2 - 2019 ER -
EndNote %0 Research Journal of Business and Management DOES PATENT CONTRIBUTE TO STOCK PRICE IN CHINA? %A Tsui-Min Chen , Chiu-Chi Wei , Hui-Chung Che %T DOES PATENT CONTRIBUTE TO STOCK PRICE IN CHINA? %D 2019 %J Research Journal of Business and Management %P -2148-6689 %V 6 %N 1 %R doi: 10.17261/Pressacademia.2019.1021 %U 10.17261/Pressacademia.2019.1021
ISNAD Chen, Tsui-Min , Wei, Chiu-Chi , Che, Hui-Chung . "DOES PATENT CONTRIBUTE TO STOCK PRICE IN CHINA?". Research Journal of Business and Management 6 / 1 (March 2019): 46-67. https://doi.org/10.17261/Pressacademia.2019.1021