Insider trading as a vehicle to appropriate rent from R&D

• 成果类型: Article
• 署名作者: Coff, RW; Lee, PM
• 署名单位: Emory University
• 刊物名称: STRATEGIC MANAGEMENT JOURNAL
• ISSN/ISSBN: 0143-2095
• DOI: 10.1002/smj.270
• 发表日期: 2003
• 页码: 183-190
• 关键词: knowledge; Insider trading; RENT APPROPRIATION; Competitive advantage

摘要

While most insider trading is routine and legal, investors still treat it as new information about the firm's prospects-they assume that trades reflect managers' attempts to profit from their private information. This article explores insider trading as a mechanism to appropriate rent from R&D advances. We analyze stock price reactions to over 134,000 insider-trading events and find that insider purchases generate larger positive stock price reactions for R&D-intensive firms. Investors seem to assume that managers use insider trading to appropriate rent from R&D breakthroughs. We discuss how shareholders may prefer this rent appropriation mechanism over other forms of compensation that directly reduce the firm's income. Copyright (C) 2002 John Wiley Sons, Ltd.