Innovation and Investment: Nasdaq-Listed Companies of Israel
Mustafa Seref Akin
DOI: 10.4236/ti.2010.14031   PDF    HTML     7,214 Downloads   11,919 Views   Citations


Using a cross-section of Nasdaq-listed Israeli companies, we examine the impact of R & D spending on their market values and the ecosystem for start-ups in Israel. We find a very strong positive association between the two, learning that $1 million of spending in R & D associated with an increase of $5 million of market value. Among all countries outside the U.S., Israel is third after Canada and China in terms of the number of stocks registered on Nasdaq. Since 1981, sixty-one companies have registered, and their total R & D spending in 2009 reached $3.750 billion, which is approximately equal to the total R & D expenditure of Turkey. In the region, Middle Eastern and North African (MENA) countries cannot accomplish to register in Nasdaq. Israel’s great success comes from the strong dedication and cooperation between private and public sectors in research and venture capital. Israel spends 4.7% of its GDP for R & D, which is equal to the total expenditure of MENA.

Share and Cite:

M. Akin, "Innovation and Investment: Nasdaq-Listed Companies of Israel," Technology and Investment, Vol. 1 No. 4, 2010, pp. 243-247. doi: 10.4236/ti.2010.14031.

Conflicts of Interest

The authors declare no conflicts of interest.


[1] R. Levine, “Finance and Growth: Theory and Evidence,” In: Aghion, P., Durlauf, S.N. (Eds.) Handbook of Economic Growth, Vol. 1A, Elsevier, Amersterdam, 2006, pp. 865-934.
[2] J. Minier, “Opening a Stock Exchange,” Journal of Development Economics,Vol. 90, 2009, pp. 135-143.
[3] J. Greenwood and B. Jovanovic “Financial Development,Growth,and the Distribution of Income,”The Journal of Political Economy, Vol. 98, No. 5, Part. 1, 1990, pp. 1076-1107.
[4] J. Handa, “Monetary Economics,” Routledge, London, 2000.
[5] J. Handa and R. Khan, “Financial Development and Economic Growth: a Symbiotic Relationship,” Applied Financial Economics, Vol. 18, 2008, pp. 1033-1049.
[6] M. Joseph and D. Sinha, “Financial Development and Economic Growth: the Case for Eight Asian Countries,” Economia Internazionale, Vol. 55, 2001, pp. 219-237.
[7] K. Neusser and M. Kugler, “Manufacturing Growth and Financial Development: Evidence from OECD Countries,” Review of Economics and Statistics, Vol. 80, 1998, pp. 636-646.
[8] P. Rousseau and P. Wachtel (1998) “Financial Intermediation and Economic Performance: Historical Evidence from Five Industrial Countries,” Journal of Money, Credit, and Banking, Vol. 30, No. 4, 1998, pp. 657-678.
[9] Zhenhui Xu, “Financial Development, Investment, and Growth,” Economic Inquiry, Vol. 38, No. 4, 2000, pp. 331-344.
[10] P. O. Demetriades and K. Hussein “Does Financial Development Cause Economic Growth: Time Series Evidence from 16 Countries,” Journal of Development Economics, Vol. 51, 1996, pp. 387-411.
[11] Nasdaq, “Nasdaq Statistics,” 2010.
[12] C. Christensen. “Innovator’s Dilemma,” Harper Business, New York, 1997.
[13] M.Desai, P. Gompers and J. Lerner, “Institutions, Capital Constraintsand Entrepreneurial Firm Dynamics: Evidence from Europe,”NBER Working Paper, No. 10165, 2003.
[14] D. Berlitz, “Political Choice and Strategies for Growth in Israel, Taiwan, and Ireland,” Yale Press, June 2009.
[15] T. Alvine and T. Heidi, “Revolutionary Wealth: How it will be created and how it will change our lives,” Broadway Business, 2007.
[16] World Economic Forum, “Competitiveness Report,” 2010.
[17] CD Rom, “World Bank Development Index,” World Bank, 2010.
[18] W. Easterly, “The Elusive Quest for Growth: Economists' Adventures and Misadventures in the Tropics,” MIT Press, 2002.
[19] S. S. Kortum and J. Lerner, “Assessing the Contribution of Venture Capital to Innovation,” RAND Journal of Economics, Vol. 31, 2000, pp. 674-692.
[20] Meng-Chi Tang and Yih-Luan Chyi, “Legal Environments, Venture Capital, and Total Factor Productivity Growth of Taiwanese Industry,” Contemporary Economic Policy, Vol. 26, 2008, pp. 468-481.

Copyright © 2023 by authors and Scientific Research Publishing Inc.

Creative Commons License

This work and the related PDF file are licensed under a Creative Commons Attribution 4.0 International License.