Financial Performance and Innovation: Evidence From USA, 1998 - 2023

24 Pages Posted: 12 Apr 2024

Date Written: March 9, 2024


This study explores the relationship between R&D intensity, as a measure of innovation, and financial performance among S&P 500 companies over 100 quarters from 1998 to 2023, including multiple crisis periods. It challenges the conventional wisdom that larger companies are more prone to innovate, using a comprehensive dataset across various industries. The analysis reveals diverse associations between innovation and key financial indicators such as firm size, assets, EBITDA, and tangibility. Our findings underscore the importance of innovation in enhancing firm competitiveness and market positioning, highlighting the effectiveness of countercyclical innovation policies. This research contributes to the debate on the role of R&D investments in driving firm value, offering new insights for both academic and policy discussions.

Keywords: Innovation, Financial Crises, financial valuation

JEL Classification: E44, O31

Suggested Citation

Kruglov, Panteleimon and Shaw, Charles, Financial Performance and Innovation: Evidence From USA, 1998 - 2023 (March 9, 2024). Available at SSRN: or

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