Purpose

The purpose of this paper is to investigate whether innovation effort is lower for firms exhibiting signs of higher chief executive officer (CEO) dominance and whether such CEOs can be incentivized to pursue risky ventures such as innovation projects in line with shareholder's interests that are geared toward the long-term growth of the firm.

Design/methodology/approach

The paper utilizes panel data of US publicly listed companies (2007–2016) to address the influence of CEO dominance on firm innovation effort and the moderating effects of incentives in this relationship through ordinary least squares (OLS) estimations. A two-stage least squares (2SLS) technique is also employed to address possible endogeneity. As a robustness check, further analysis is conducted utilizing an alternative proxy for CEO incentive as well as Tobit analysis (with panel-level random effects).

Findings

Results from both OLS and Tobit estimations offer two key findings. First, there is a significantly negative relationship between CEO pay slice and firm research and development (R&D) intensity. Second, the interaction effect of CEO incentives and CEO dominance is significant and positive.

Research limitations/implications

When provided with the right incentives, such as those that reward long-term performance, dominant CEOs can be incentivized to go after risky ventures like innovation projects that are crucial to promoting the long-term growth of the firm.

Originality/value

This paper utilizes R&D instead of patent outputs as proxies for innovation where the former enables studying R&D efforts for more recent periods compared to prior studies that utilize patent data.

中文翻译：

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CEO主导地位和企业创新努力

目的

本文的目的是调查表现出更高首席执行官 (CEO) 主导地位迹象的公司的创新努力是否较低，以及是否可以激励这些 CEO 进行风险投资，例如符合股东利益的创新项目公司的长期发展。

设计/方法/方法

本文利用美国上市公司（2007-2016 年）的面板数据，通过普通最小二乘法 (OLS) 估计来解决 CEO 主导对公司创新努力的影响以及激励在这种关系中的调节作用。还采用两阶段最小二乘法 (2SLS) 技术来解决可能的内生性问题。作为稳健性检查，使用 CEO 激励的替代代理以及 Tobit 分析（具有面板级随机效应）进行进一步分析。

发现

OLS 和 Tobit 估计的结果提供了两个关键发现。首先，CEO薪酬份额与公司研发（R&D）强度之间存在显着的负相关关系。其次，CEO激励与CEO主导权的交互作用显着且为正。

研究限制/影响

如果提供适当的激励措施，例如奖励长期绩效的激励措施，占主导地位的 CEO 就会受到激励去追求风险投资，例如对促进公司长期增长至关重要的创新项目。

原创性/价值

本文利用研发而不是专利产出作为创新的代理，与利用专利数据的先前研究相比，前者能够研究最近时期的研发工作。