Abstract
Most previous research in this area has conceptualized innovation through one or more dimensions of a firm’s innovative capability such as R&D of a firm. The measurement of the construct has thus reflected this narrow conceptualization with a single measure such as R&D expenditure of a firm being the most often used proxy. This study utilizes a broader definition of organizational innovation capabilities that includes the generation, dissemination and strength of innovative activity in a firm. Such a composite measure is then used to predict market value of a firm. The unique features of this study are that it uses multiple indicators of firm innovation, it uses 10 year cross sectional, longitudinal data on a firm’s innovation profile