What’s inside the Mind of a CEO? The Effects of Discretionary Slack Resources on R&D Investment
This study investigates the effects of discretionary slack resources on a firm’s R&D investment. Specifically, we examine whether and how a CEO’s psychological traits play a role in the relationship between discretionary slack and R&D investment. Using a panel sample from U.S. manufacturing...
| Main Authors: | , , |
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| Format: | Article |
| Language: | English |
| Published: |
MDPI AG
2023-03-01
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| Series: | Behavioral Sciences |
| Subjects: | |
| Online Access: | https://www.mdpi.com/2076-328X/13/3/247 |
| _version_ | 1797613516916523008 |
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| author | Seunghye Lee Won-Yong Oh Young Kyun Chang |
| author_facet | Seunghye Lee Won-Yong Oh Young Kyun Chang |
| author_sort | Seunghye Lee |
| collection | DOAJ |
| description | This study investigates the effects of discretionary slack resources on a firm’s R&D investment. Specifically, we examine whether and how a CEO’s psychological traits play a role in the relationship between discretionary slack and R&D investment. Using a panel sample from U.S. manufacturing firms in 2006–2010, we found that slack resources lead to an increase in R&D intensity. Furthermore, this positive effect is stronger when CEOs have a strong promotion focus and perceive an addressable negative attainment discrepancy. Thus, our findings show how (a) the level of discretionary slack and (b) CEOs’ promotion focus and aspiration level jointly shape R&D investment decisions. Considering CEOs’ psychological traits contributes to a more comprehensive view of the conditions under which discretionary slack resources matter for a firm’s strategic decisions. |
| first_indexed | 2024-03-11T06:55:51Z |
| format | Article |
| id | doaj.art-cb0ba2ca56ea4ec7a9644dabe647d983 |
| institution | Directory Open Access Journal |
| issn | 2076-328X |
| language | English |
| last_indexed | 2024-03-11T06:55:51Z |
| publishDate | 2023-03-01 |
| publisher | MDPI AG |
| record_format | Article |
| series | Behavioral Sciences |
| spelling | doaj.art-cb0ba2ca56ea4ec7a9644dabe647d9832023-11-17T09:38:07ZengMDPI AGBehavioral Sciences2076-328X2023-03-0113324710.3390/bs13030247What’s inside the Mind of a CEO? The Effects of Discretionary Slack Resources on R&D InvestmentSeunghye Lee0Won-Yong Oh1Young Kyun Chang2Sogang Business School, Sogang University, Seoul 04107, Republic of KoreaLee Business School, University of Nevada, Las Vegas, NV 89154, USASogang Business School, Sogang University, Seoul 04107, Republic of KoreaThis study investigates the effects of discretionary slack resources on a firm’s R&D investment. Specifically, we examine whether and how a CEO’s psychological traits play a role in the relationship between discretionary slack and R&D investment. Using a panel sample from U.S. manufacturing firms in 2006–2010, we found that slack resources lead to an increase in R&D intensity. Furthermore, this positive effect is stronger when CEOs have a strong promotion focus and perceive an addressable negative attainment discrepancy. Thus, our findings show how (a) the level of discretionary slack and (b) CEOs’ promotion focus and aspiration level jointly shape R&D investment decisions. Considering CEOs’ psychological traits contributes to a more comprehensive view of the conditions under which discretionary slack resources matter for a firm’s strategic decisions.https://www.mdpi.com/2076-328X/13/3/247CEOR&D investmentslack resourcespromotion focusfuture focusaspiration level |
| spellingShingle | Seunghye Lee Won-Yong Oh Young Kyun Chang What’s inside the Mind of a CEO? The Effects of Discretionary Slack Resources on R&D Investment Behavioral Sciences CEO R&D investment slack resources promotion focus future focus aspiration level |
| title | What’s inside the Mind of a CEO? The Effects of Discretionary Slack Resources on R&D Investment |
| title_full | What’s inside the Mind of a CEO? The Effects of Discretionary Slack Resources on R&D Investment |
| title_fullStr | What’s inside the Mind of a CEO? The Effects of Discretionary Slack Resources on R&D Investment |
| title_full_unstemmed | What’s inside the Mind of a CEO? The Effects of Discretionary Slack Resources on R&D Investment |
| title_short | What’s inside the Mind of a CEO? The Effects of Discretionary Slack Resources on R&D Investment |
| title_sort | what s inside the mind of a ceo the effects of discretionary slack resources on r d investment |
| topic | CEO R&D investment slack resources promotion focus future focus aspiration level |
| url | https://www.mdpi.com/2076-328X/13/3/247 |
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