Product Life Cycles in Corporate Finance

• 成果类型: Article
• 署名作者: Hoberg, Gerard; Maksimovic, Vojislav
• 署名单位: University of Southern California; University System of Maryland; University of Maryland College Park
• 刊物名称: REVIEW OF FINANCIAL STUDIES
• ISSN/ISSBN: 0893-9454
• DOI: 10.1093/rfs/hhab134
• 发表日期: 2022
• 页码: 4249
• 关键词: capital structure; stock-market; panel-data; INVESTMENT; acquisitions; constraints; COMPETITION; sensitivity; INNOVATION; decisions

摘要

We develop a novel 10-K text-based model of product life cycles and examine firm investment policies. Conditioning on the life cycle substantially improves the power of q to explain investment and reveals a natural ordering of investments over the life cycle. While R&D and CAPX sensitivity are high early in the cycle, acquisitions arise as products mature, and divestitures and product extension investments arise as products decline. q-sensitivities that condition on the life cycle can vary by as much as 400% from traditional sensitivities. The life cycle framework further reveals an enriched relationship between competition, investment, and corporate profits.