SYNOPSIS:

This paper investigates possible benefits or competitive advantages of management information system (MIS) variables from the perspective of intangible asset benefits (i.e., do they contribute to the value of a company?). Extensive descriptions of MIS attributes for major public corporations have recently become available for the first time. The contribution of these MIS variables toward corporate market value was assessed using an economic model which analyzes such contributions of intangible assets as research and development (R&D) and advertising.

The only MIS variable found to be significant was MIS expenditures which had a negative effect on firms' market values, except for firms in a few specific industries. Thus, financial markets generally appear to have a negative view toward the contributions of MIS variables to the market value of a company, a view opposed to various hypothesized benefits of MIS variables in the MIS literature. The results may also have implications concerning financial reporting disclosures of MIS expenditures as a key variable, similar to the disclosure requirements for R&D and software development.