Document Type

Article

Publication Date

3-11-2023

Publication Title

Behavioral Sciences

Volume

13

Abstract

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.

Keywords

CEO; R&D Investment; Slack Resources; Promotion Focus; Future Focus; Aspiration Level

Disciplines

Business | Business Administration, Management, and Operations

File Format

pdf

File Size

1045 KB

Language

English

Rights

IN COPYRIGHT. For more information about this rights statement, please visit http://rightsstatements.org/vocab/InC/1.0/

Creative Commons License

Creative Commons Attribution 4.0 License
This work is licensed under a Creative Commons Attribution 4.0 License.

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