Transparency and firm innovation

• 成果类型: Article
• 署名作者: Thong, Rong (Irene)
• 署名单位: University of Illinois System; University of Illinois Chicago; University of Illinois Chicago Hospital
• 刊物名称: JOURNAL OF ACCOUNTING & ECONOMICS
• ISSN/ISSBN: 0165-4101
• DOI: 10.1016/j.jacceco.2018.02.001
• 发表日期: 2018
• 关键词: research-and-development; international accounting standards; corporate governance; ceo turnover; INSTITUTIONAL OWNERSHIP; investment efficiency; information asymmetry; financial development; earnings management; DISCLOSURE POLICY

摘要

Firm innovation drives both firm competitiveness and economic growth. Constructing a novel firm-patent panel database from 29 countries, I find that transparency directly boosts innovative effort by reducing managerial career concerns. This effect operates through transparency's implicit contracting role: it reduces the sensitivity of management turnover to poor innovative output. Transparency also increases innovative efficiency through its governance role in facilitating efficient allocation of R&D capital. Nonetheless, the benefit of transparency is fully offset in environments with greater proprietary cost. These findings illuminate the unique roles and mechanisms of transparency in promoting innovation incentives and outcomes.