Sun Yat-Sen Management Review

  Journal Fullview

Sun Yat-Sen Management Review  2020/6

Vol. 28, No.2  p.333-355


An Attention-Based View of Advertising Investment and Stock Return of Cross-Listings
(147_M5eeb074b79e77_Full.pdf 823KB)

Chi-Lin Yang/

Department of Urban Industrial Management and Marketing, University of Taipei



(147_M5eeb074b79e77_Abs.pdf(File does not exist))




This study uses an attention-based view (ABV) to investigate how advertising investment influences stock returns. The advertising expenditures can not only create the intangible investment but also to catch the attention of investors. In these empirical results, first, the advertising investment can engage the investor’s attention to create the positive stock return. Secondly, the cross-listing firms from emerging countries and high-tech cross-listing firms bring the positive performance. Finally, cross-listing firms from emerging countries and high-tech cross-listing firms with more advertising expenditures own the positive impact on stock return. In particular, the high-tech cross-listing firms from the emerging countries have the positive stock return through advertising investments. For the managerial implication, the manager should increase advertising investments to build intangible assets and attract the attention of investors since less asymmetric information.

(147_M5eeb074b79e77_Abs.pdf(File does not exist))


Attention-based View, Advertising Investment, Investor, Stock Return

Policy and management implications
(Available only in Chinese)

The study has two implications for management. It supports the positive relationships among firm action, firm characteristics, and stock market valuation. Researchers would track the advertising investment, determine the outcomes of advertising investment decisions, and attempt to assess when and by how much market valuation changes in the future. First, the results demonstrate that advertising causes an investor’s response through a net increase in revenue. It means that advertising investment has a double impact on firm value, demonstrating that advertising investment can not only have positive impacts on earnings and revenues, but also bring positive effects on stock returns. This implies that managers should be cognizant of impacts due to advertising. Because managers could increase the level of advertisement for an intangible asset, it is simple enough to attract the attention of investors. Second, from an economic standpoint, the object of corporate strategy is the selection of countries or industries in which to participate and to better valuate in the market. Thus, there is another motivation for managers to spend specific intangible investments. Specifically, the results suggest that managers of high-tech cross-listing firms from emerging countries should increase advertising expenditure to gain the attention of investor, because the purpose of business strategy is to achieve a differential advantage over other competitors from other regions or industries.


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