Accounting Research Journal
Arthur J. Bauernfeind College of Business
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.
The authors use clustered standard errors ordinary least squares regression using a large sample of US firms from 1994 to 2017.
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.
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.
Naaman, C., & Sun, L. (2021). CEO power and R&D investment. Accounting Research Journal.
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