Impact of Managers’ Traits and Compensation Structure on R&D Investments
DOI:
https://doi.org/10.33423/jabe.v20i9.221Keywords:
Business, Economics, Finance, InvestmentAbstract
This study examines the relationships between the characteristics of top management and a firm’s R&D expenditure level. We measure management entrenchment using executives’ tenures, ages, cash compensation, and dual roles as a chairman. The result suggests that firms with less entrenched management (i.e., younger, newer, and non-chairman executives with less cash compensation) invest more in R&D. Our result also shows that executives whose compensation has a higher sensitivity to stock volatility are associated with higher degree of R&D expenditures implying that executives’ compensation structures tend to influence R&D decisions.
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Published
2018-12-30
How to Cite
Kim, J., & Wang, X. (2018). Impact of Managers’ Traits and Compensation Structure on R&D Investments. Journal of Applied Business and Economics, 20(9). https://doi.org/10.33423/jabe.v20i9.221
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