The crowding-out effect of shareholder value-based CEO compensation on R&D investment in the European context: a new interpretation
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Tarih
2023
Yazarlar
Dergi Başlığı
Dergi ISSN
Cilt Başlığı
Yayıncı
Emerald Group Publishing Ltd
Erişim Hakkı
info:eu-repo/semantics/closedAccess
Özet
Purpose In the present study, using a novel fractional logit model, the link between R&D (Research & Development) investment and shareholder value-based CEO (Chief Executive Officer) compensation has been examined within the non-financial sector in the Euro area economies using a firm-level dataset for 2002-2019. Design/methodology/approach The fractional logit model is utilized to examine the effects of corporate payment on R&D investment. The fractional logit model can be considered the empirical approach that takes into account R&D non-performer firms to avoid reducing the sample size. The fractional logit model is superior to the censored or truncated models, like Tobit, since the fractional logit model is useful to address the econometric limitations that are found in the censored and truncated models in the non-linear models. Findings The findings obtained in this study showed a significant and negative effect of short-term aim-based CEO payment on R&D expenditures in the Euro area economies using firm-level data. These findings are robust to different robustness checks and modeling alternatives. Originality/value To the author's knowledge, there is no study that examines the effects of short-term shareholder value maximization-based CEO compensation on R&D in the European context in the literature.
Açıklama
Anahtar Kelimeler
Corporate payment, R&D, The Euro area economies, Firm-level R&D expenditures
Kaynak
Kybernetes
WoS Q Değeri
Q3
Scopus Q Değeri
Q1
Cilt
52
Sayı
12
