Advertisement

Investment Behaviors of Businesses on Ad and R&D According to Their Sizes: Food, Beverage and Tobacco Sector in Turkey

  • Çağla Pınar BozokluEmail author
  • Yasemin Keskin Benli
Conference paper
Part of the Springer Proceedings in Complexity book series (SPCOM)

Abstract

It is observed that the advertising and R&D expenditures of businesses, which are traded on Borsa Istanbul (BIST) in the Food, Beverage and Tobacco Sector, differ according to their business sizes. Within this context, two assumptions are developed. At first, the large businesses invest on the advertising and R&D expenditures regularly from sales revenues. At second, the relatively smaller businesses invest on these operations only in the periods which they generate over-expected sales revenues. In order to test these assumptions, the impacts of advertising and R&D expenditures on the sales revenues of large and middle-sized businesses in Food, Beverage and Tobacco Sector in BIST (2009–2013) are analyzed by panel regression after 22 businesses in the sector are classified as the large and middle-sized businesses according to their number of employees. As a result, it is proved that the large businesses invest on the advertising and R&D expenditures regularly. On the other hand, the middle-sized businesses set the R&D budget depending on their annual sales revenues whereas they act as the large businesses in terms of setting advertising budget.

Keywords

Advertising expenditures R&D expenditures Business size Panel data Unit root test Panel regression 

References

  1. 1.
    Aaker DA, Carman JM, Jacobson R (1982) Modeling advertising-sales relationships involving feedback: a time series analysis of six cereal brands. J Market Res 19:116–125CrossRefGoogle Scholar
  2. 2.
    Aghion P, Howitt P (1992) A model of growth through creative destruction. Econometrica 60:323–351CrossRefzbMATHGoogle Scholar
  3. 3.
    Assmus G, Farley JU, Lehmann DR (1984) How advertising affects sales: meta-analysis of econometric results. J Market Res 21:65–74CrossRefGoogle Scholar
  4. 4.
    Bemmaor AC (1984) Testing alternative econometric models on the existence of advertising threshold effect. J Market Res 21:298–308CrossRefGoogle Scholar
  5. 5.
    Brooks C (2008) Introductory econometrics for finance. Cambridge University Press, New YorkCrossRefzbMATHGoogle Scholar
  6. 6.
    Cameron AC, Trivedi PK (2005) Microeconometrics: methods and applications. Cambridge University Press, New YorkCrossRefGoogle Scholar
  7. 7.
    Cemalcılar İ (1988) Pazarlama, kavramlar kararlar. Beta Yayınları, İstanbulGoogle Scholar
  8. 8.
    Clarke DG (1976) Econometric measurement of the duration of advertising effect on sales. J Market Res 13:345–357CrossRefGoogle Scholar
  9. 9.
    Day G, Fahey L (1988) Valuing market strategies. J Market 52:45–57CrossRefGoogle Scholar
  10. 10.
    Dickey DA, Fuller WA (1979) Distribution of the estimators for autoregressive time series with a unit root. J Am Stat Assoc 74(366):427–431MathSciNetCrossRefzbMATHGoogle Scholar
  11. 11.
    Doi N (1977) Firm size, market power, and research and development. J Econ Kwansei Gakuin Univ 31(3):99–123Google Scholar
  12. 12.
    Johnston J, Dinardo J (1997) Econometric methods. McGraw-Hill, New YorkGoogle Scholar
  13. 13.
    Graham RC, Frankenberger KD (2000) The contribution of changes in advertising expenditures to earnings and market values. J Bus Res 50:149–155CrossRefGoogle Scholar
  14. 14.
    Grossman GM, Elhanan H (1991) Quality ladders in the theory of growth. Rev Econ Stud 58(1):43–61CrossRefGoogle Scholar
  15. 15.
    Hausman JA (1978) Specification tests in econometrics. Econometrica 16(6):1251–1271Google Scholar
  16. 16.
    Kamber T (2002) The brand manager’s dilemma: understanding how advertising expenditures affect sales growth during a recession. Brand Manage 10(2):106–120CrossRefGoogle Scholar
  17. 17.
    Korkmaz T, Yildiz B, Gökbulut Rİ (2010) FVFM’nin İMKB ulusal 100 endeksindeki geçerliliğinin panel veri analizi ile test edilmesi. İ.Ü. İşletme Fakültesi Dergisi 39(1):95–105Google Scholar
  18. 18.
    Leonard W (1971) R&D in industrial growth. J Polit Econ 79(2):232–256CrossRefGoogle Scholar
  19. 19.
    Levin A, Lin CF, Chu CSJ (2002) Unit root tests in panel data: asymptotic and finite-sample properties. J Econometr 108:1–24MathSciNetCrossRefzbMATHGoogle Scholar
  20. 20.
    McGraw-Hill Research (1986) Laboratory of advertising performance report 5262. McGraw-Hill, New YorkGoogle Scholar
  21. 21.
    Odagiri H (1983) R&D expenditures, royalty payments, and sales growth in Japanese manufacturing corporations. J Ind Econ 32(19):61–71CrossRefGoogle Scholar
  22. 22.
    Özbek Y, Utkutuğ ÇP (2012) Cumulative advertising effects: presentation on financial statements of long term advertising effects on sales. Int J Arts Commer 1(4):237–247Google Scholar
  23. 23.
    Palda KS (1964) The measurement of cumulative advertising effects. Prentice-Hall, Englewood CliffsGoogle Scholar
  24. 24.
    Parsons LJ, Schultz RL (1976) Marketing models and econometric research. North-Holland, New YorkzbMATHGoogle Scholar
  25. 25.
    Phillips PCB, Perron P (1988) Testing for a unit root in time series regression. Biometrika 75:335–346MathSciNetCrossRefzbMATHGoogle Scholar
  26. 26.
    Ravenscraft D, Scherer FM (1982) The lag structure of returns to research and development. Appl Econ 14:603–620CrossRefGoogle Scholar
  27. 27.
    Republic of Turkey Ministry of Science Industry and Technology (2012) The regulation about the definition, qualifications and classifications of small and middle-sized businesses. http://www.resmigazete.gov.tr/eskiler/2012/11/20121104-11.htm. Accessed 2 July 2014
  28. 28.
    Romer PM (1990) Endogenous technical change. J Polit Econ 98:71–102CrossRefGoogle Scholar
  29. 29.
    Rosenberg JB (1976) Research and market share: a reappraisal of the Schumpeter hypothesis. J Ind Econ 25(2):101–112CrossRefGoogle Scholar
  30. 30.
    Tellis GJ, Tellis K (2009) Research on advertising in a recession: a critical review and synthesis. J Advert Res 49:9–40Google Scholar
  31. 31.
    Vaile RS (1927) The use of advertising during depression. Harv Bus Rev 3:323–330Google Scholar
  32. 32.
    Wang F, Zhang XP, Ouyang M (2009) Does advertising create sustained firm value? The capitalization of brand intangible. J Acad Market 37:130–143CrossRefGoogle Scholar
  33. 33.
    Weiss DL, Windal PM (1980) Testing cumulative advertising effects: a comment on methodology. J Market Res 17:371–378CrossRefGoogle Scholar
  34. 34.
    Winer RS (1979) An analysis of the time-varying effects of advertising: the case of Lydia Pinkham. J Bus 52(4):563–576CrossRefGoogle Scholar
  35. 35.
    Yıldız G (2003) Araştırma- Geliştirme maliyetlerinin türkiye muhasebe standardı 15 (TMS-15) ve tek düzen muhasebe sistemi (TDMS) esasına göre muhasebeleştirilmesi. İktisadi ve İdari Bilimler Dergisi 17(1–2):353–370Google Scholar

Copyright information

© Springer International Publishing Switzerland 2016

Authors and Affiliations

  1. 1.Faculty of Economics and Administrative Sciences, Department of Healthcare ManagementGazi UniversityAnkaraTurkey
  2. 2.Faculty of Economics and Administrative Sciences, Department of International TradeGazi UniversityAnkaraTurkey

Personalised recommendations