International E-publication: Publish Projects, Dissertation, Theses, Books, Souvenir, Conference Proceeding with ISBN.  International E-Bulletin: Information/News regarding: Academics and Research

A Study of the Relationship between Economic Criteria and Performance Evaluation Accounting with Marketât's Value added in the Firms Listed in the Tehran Stock Exchange

Author Affiliations

  • 1Department of Accounting, Gilan Science and Research Branch, Islamic Azad University, Gilan, IRAN
  • 2 Department of Accounting, Payame Noor University, Birjand, IRAN
  • 3 Department of Accounting, Faculty of Management and Accounting, Chaloos Branch, Islamic Azad University, Chaloos, IRAN

Res. J. Recent Sci., Volume 2, Issue (7), Pages 31-36, July,2 (2013)


Currently most analysts believe that market’s value added is a major indicator in assessing the shareholders’ wealth increase. Therefore, one purpose of the present paper is to specify criteria which are closely related to this issue and are capable of assessing the performance of economic units and ultimately, their wealth in a more accurate fashion.This paper examines the relationship between moderated economic value added as well as some accounting and financial criteria such as return on stock, earnings per share (EPS), return on assets and return on equities with the market’s value added as an external indicator of value-creation (the study’s dependent variable) between 2006 and 2010 using the pooled data method. Results indicate that all study variables are in direct linear and significant relationship with market value added at a 95% confidence level. At the same time, the results suggest that moderated economic value added, after returns on equities, has the strongest relationship with market value added.


  1. Mouelhi C. and Saint J., The relationship between external and internal performance measures of the firm: A panel cointegration approach, Social Science Research Network, Electronic copy available at: (2010)
  2. Abzari Mahdi et al., Performance evaluation of substantial metals group firms in Tehran stock exchange using EVA model and examination of its relationship with earnings accounting criteria, Financial research 26(1), 20-23 (2008)
  3. Jahankhani A., and Zariffard A., Do managers and shareholders use appropriate measures to assess value? Financial research quarterly 2(7-8), 1-10 (1995)
  4. Rahnamaye Roodposhti F., Nikoomaram H., and Shahverdiani S., Strategic financial management, Tehran, Kassakavesh Publishing house, (2006)
  5. Stewart G.B., The quest for value, Harper Business,(1991)
  6. Bacidore J.M., Boquist J.A., Milbourn T.T. and Thakor A.V., The search for the best finance performance measure, The Journal of finance analysis, 38(4), 11–20 (1997)
  7. Biddle G.C., Bowen R.M. and Wallace J.S., Evidence on EVA, Journal of Applied Corporate Finance,12(2), 69–79 (1999)
  8. Austin L.M., Bench marketing to economic value added, Benchmarking: An international, 12(2), 138–150 (2005)
  9. Ross S.A., Westerfield R. and Jordan B.D., Fundamentals of corporate finance, Tata McGraw-Hill Education (2008)
  10. Uyemura D.G., Kantor C.C. and Pettit J.M., EVA for banks: Value creation, risk management, and profitability measurement, Journal of Applied Corporate Finance, 9(2), 94–109 (1996)
  11. Zaima J.K., Turetsky H.F. and Cochran B., The MVA-EVA Relationship: Separation of Market Driven Versus Firm Driven Effects, Review of Accounting and Finance, 4(1), 32–49 (2005)
  12. Ramana D.V., Market value added and economic value added":Social Science Research Network, Electronic copy Available:,(2004)
  13. Pooyanfar A., A study of the relationship between accounting and economic performance criteria and firms’ value in cement and petrochemicals industries of Tehran stock exchange, Accounting and audit studies, 61(1), 71-84 (2010)
  14. Hejazi Rezvan and Hosseini, Arefeh, A comparison of the relationship between MVA and EVA with accounting criteria in Tehran stock exchange, Economic investigations, 31, 261-237 (2006)
  15. Ghanbari M.A. and More V.S., The Relationship between Economic Value Added and Market Value Added: An empirical analysis in Indian Automobile Industry, The Journal of Accounting Research, 6(3), 7-22 (2001)
  16. Yahyazadeh Far, Mahmood Shams, Shahabeddin and Larimi S.J., The relationship between EVA and profitability ratios with MVA of Tehran stock exchange enlisted firms, Accounting and audit studies, 59(1), 128-113 (2010)
  17. Baltaghi H.B., Econometric analysis of Panel Data.(3nd edn), New York: John Wily & Sons Ltd, (2005)
  18. Levin A., Lin C.F. and James Chu C.S., Unit root tests in panel data: asymptotic and finite-sample properties, Journal of econometrics 108(1), 1–24 (2002)
  19. Im K.S., Pesaran M.H. and Shin Y., Testing for unit roots in heterogeneous panels, Journal of econometrics, 115(1), 53–74 (2003)