Drivers of R&D investment: The interaction of behavioral theory and managerial incentives

Organizational structure, slack resources and sustainable corporate socially responsible performance

“…The relationship between organizational slack resources (the slacks) and firm performance (the slack-performance relationship) has been studied by many authors (e.g. Alessandri & Pattit, 2014;Cheng & Kesner, 1997;George, 2005;Marano, Tashman, & Kostova, 2017;Mousa, Dan, & Ritchie, 2013). Some authors consider slack as a benefit because it can buffer organizations from shortages of funds and it is argued to increase the potential for firm innovation (e.g.…”

Innovating Beyond the Horizon: CEO Career Horizon, Top Management Composition, and R&D Intensity

“…We contend that, although CEOs ultimately make choices and are held chiefly accountable (Arendt et al, ), TMTs assist the CEO in formulating and implementing R&D strategies. Indeed, as “complex decisions, such as investing in R&D, often involve other members of the team in addition to the CEO” (Alessandri & Pattit, , p. 152), we propose that the characteristics of TMTs represent an important conceptual omission in extant treatments of the CEO career horizon problem. As the traditional agency approach has been criticized for providing an undersocialized representation of CEO behavior (e.g., Lubatkin, Lane, Collin, & Very, ), we make an important addition to the literature by contextualizing CEO dispositions as constrained or enabled by the interfacing TMT attributes.…”

Executive Compensation

“…finds that the absolute level of stock option pay is positively related to companies' acquisition propensity. and Alessandri and Pattit (2014) find a positive influence of stock option pay on R&D investments. Kang et al (2006) find a positive relationship between total equity compensation (including stock options, stock appreciation rights, and restricted stock) and total investments, measured as a composed figure of R&D, capex, and acquisitions.…”

“…In summary, empiricists largely agree that incentives from stock option holdings and flow compensation increase managers' devotion to investments (e.g., Sanders, 2001;Rajgopal & Chevlin, 2002;, whereas stock ownership decreases investment intensity (e.g., Sanders, 2001;Alessandri & Pattit, 2014). However, all of this research is focused on the United States (US).…”