The Effect of Investment in Information Technology on the Performance of Firms Listed at Palestinian Security Exchange

The Effect of Investment in Information Technology on the Performance of Firms Listed at Palestinian Security Exchange

Naser Abdelkarim, & Said Alawneh

alawnehsaid@hotmail.com

Received : 15-01-2007 , Accepted : 26-05-2009

Language: Arabic

Abstract

This study aims at testing the effect of investment in information technology on the performance of firms listed at Palestinian Security Exchange according to accounting performance measures namely return on assets (ROA), return on equity (ROE), return on sales (ROS), sales growth, and the market value of the firm measured by Tobin's q. On the other hand, the research is an attempt to know which one of them is more influenced by the investment in information technology. The sample of the study consisted of (22) Companies listed on the Palestinian Stock Exchange during the period 1998-2003.The researcher used the multi regression in order to analyze and test the general hypothesis. The study revealed that the investment in information technology has a positive effect on accounting performance measures, and the market value of the firms. This effect appears after two years. Due to this the study recommends that the companies must invest in the information technology and communication because it has a positive effect on the market value and the financial performance. The Palestinian authority must work to liberate the technology and communication sectors in order to make it more competitive, by issuing a law to organize and this sector.

Full Text