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- Title
Market Reaction to Announcements to Invest in ERP Systems.
- Authors
Benco, Daniel C.; Prather, Larry
- Abstract
We examine the reaction of 111 firms that announce investments in ERP systems. To ensure that the results are robust, we use equally weighted and value weighted indices, estimate event study betas with OLS and Scholes-Williams techniques, and use GARCH and EGARCH methods to examine how differences in assumptions concerning event period return variance affect the results. Further examination controls for firm size, industry, and health. Finally, matched-pair analysis examines whether ERP announcements by a firm affect non-announcing firms. Results reveal that only healthy firms that announce ERP investments experience statistically significant event period returns. Moreover, those results are robust.
- Subjects
ELECTRONIC Road Pricing System; INDUSTRIAL management; INVESTMENTS; RETURNS on sales; FINANCIAL performance
- Publication
Quarterly Journal of Finance & Accounting, 2008, Vol 47, Issue 4, p145
- ISSN
1939-8123
- Publication type
Article