The financial performance of global information and communication technology companies

Bauer, TD; Dehning, B; Stratopoulos, TC

The financial performance of global information and communication technology companies

Bauer, TD Dehning, B Stratopoulos, TC

Permalink

Publisher:: American Accounting Association
Publication Type:: Journal Article
Citation:: Journal of Information Systems, 2012, 26 (2), pp. 119 - 152
Issue Date:: 2012-01

Closed Access

	Filename	Description	Size
	2012003103OK.pdf		879.84 kB	Adobe PDF	View/Open

Copyright Clearance Process

Recently Added
In Progress
Closed Access

This item is closed access and not available.

Full metadata record

Field	Value	Language
dc.contributor.author	Bauer, TD
dc.contributor.author	Dehning, B
dc.contributor.author	Stratopoulos, TC
dc.date.accessioned	2014-04-03T01:25:27Z
dc.date.issued	2012-01
dc.identifier.citation	Journal of Information Systems, 2012, 26 (2), pp. 119 - 152
dc.identifier.issn	0888-7985
dc.identifier.other	C1	en_US
dc.identifier.uri	http://hdl.handle.net/10453/23300
dc.description.abstract	This study examines the cross-sectional financial performance among firms from the global information and communication technology (ICT) sector over the period 19982007. Using a pooled linear regression, the results show that U.S.-based ICT companies are on average underperforming the rest of the world after controlling for firm-specific variables known to affect firm financial performance. The results also show that characteristics of the firm's host country explain a statistically significant portion of the variation in firm performance, incremental to firm-level characteristics. More specifically, firms located in countries with attractive tax environments and high-government subsidies outperform their competitors in countries with less attractive tax environments and subsidies. Firms in financial markets that provide ICT firms with relatively favorable cost of capital underperform those in markets with a cost of capital less conducive to business development, which may suggest the cost of capital attracts new market competition that reduces overall profit. Countries with the best performing ICT firms are those with the highest industry focus, where a few industries dominate rather than an even distribution of firms across a broad range of industries. The findings have important implications for policymakers, business strategists, and investors.
dc.publisher	American Accounting Association
dc.relation.ispartof	Journal of Information Systems
dc.rights	info:eu-repo/semantics/closedAccess
dc.subject	financial performance, tax environment, cost of capital, industry focus, information and communication technology industry	en_US
dc.subject.classification	Accounting, Auditing and Accountability	en_US
dc.title	The financial performance of global information and communication technology companies
dc.type	Journal article
utslib.citation.volume	26
utslib.citation.number	2	en_US
utslib.citation.startpage	119	en_US
utslib.citation.endpage	152	en_US
utslib.identifier.org	BUS.School of Accounting	en_US
utslib.for	1501 Accounting, Auditing and Accountability
pubs.embargo.period	Not known
pubs.organisational-group	/University of Technology Sydney
pubs.organisational-group	/University of Technology Sydney/Faculty of Business
pubs.organisational-group	/University of Technology Sydney/Faculty of Business/School of Accounting
utslib.copyright.status	closed_access
pubs.declined	1970-01-01T00:00:00.0+1000

Abstract:

This study examines the cross-sectional financial performance among firms from the global information and communication technology (ICT) sector over the period 19982007. Using a pooled linear regression, the results show that U.S.-based ICT companies are on average underperforming the rest of the world after controlling for firm-specific variables known to affect firm financial performance. The results also show that characteristics of the firm's host country explain a statistically significant portion of the variation in firm performance, incremental to firm-level characteristics. More specifically, firms located in countries with attractive tax environments and high-government subsidies outperform their competitors in countries with less attractive tax environments and subsidies. Firms in financial markets that provide ICT firms with relatively favorable cost of capital underperform those in markets with a cost of capital less conducive to business development, which may suggest the cost of capital attracts new market competition that reduces overall profit. Countries with the best performing ICT firms are those with the highest industry focus, where a few industries dominate rather than an even distribution of firms across a broad range of industries. The findings have important implications for policymakers, business strategists, and investors.

Please use this identifier to cite or link to this item:

http://hdl.handle.net/10453/23300