The Impact of R&D Expenses on Firm Performance: Empirical Witness from the Bist Technology Index

The relationship between investment in R&D and company performance has attracted the interest of several research. Vast amount of research have been carried to figure out whether this relationship exist or not. Some researchers suggest that there is no relationship between R&D expenses and firm performance; others put forward the existence of negative or positive relationship. It can be asserted that possible existence as useful information can be consumed by managers to increase the market value of firms. In that respect, the main aim of this research is to reveal the relationship between R&D and firm performance by taking into account 12 companies that are listed on the BIST Technology Index for 5 years periods (between 2010 and 2014). In order to accomplish this purpose, we employed pooled regression model and cross sectional time series analysis technique. In general, although negative and positive coefficients are found, almost, all of them is not statistically significant. In other words, according to outcomes, it can be claimed that there is no relationship between R&D and firm performance which is line with previous studies