Document Type
Journal Article
Publication Date
7-16-2021
Publication Title
Accounting Research Journal
Department
Accounting
College/School
Arthur J. Bauernfeind College of Business
Abstract
Purpose
This study aims to examine whether and how the power of a chief executive officer (CEO) relates to firm-level research and development (R&D) investment.
Design/methodology/approach
The authors use clustered standard errors ordinary least squares regression using a large sample of US firms from 1994 to 2017.
Findings
The authors find a significant negative relation between CEO power and R&D investment, suggesting that firms with more powerful CEOs are less likely to invest in R&D activities. Besides, the study finds that this significant negative relation is largely driven by firms with weaker corporate governance.
Originality/value
This study contributes to the finance literature on the impact and consequences of having powerful CEOs and the financial accounting literature on the determinants of R&D expenditures.
Recommended Citation
Naaman, C., & Sun, L. (2021). CEO power and R&D investment. Accounting Research Journal.
Creative Commons License
This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License
Comments
This is an accepted article published by Emerald in Accounting Research Journal, available at https://doi.org/10.1108/ARJ-07-2020-0195