Excess Commitment in R&D

• 成果类型: Article
• 署名作者: Guenzel, Marius; Liu, Tong
• 署名单位: University of Pennsylvania; Massachusetts Institute of Technology (MIT)
• 刊物名称: REVIEW OF FINANCIAL STUDIES
• ISSN/ISSBN: 0893-9454; 1465-7368
• DOI: 10.1093/rfs/hhag026
• 发表日期: 2026-07
• 页码: 2179-2221
• 关键词: G31; O32; L65; D91; D22; sunk-cost fallacy; long-term; INNOVATION; MODEL; SENSITIVITIES; incentives; escalation; DECISION; price; NBA

摘要

We document that firms exhibit excess commitment to R&D projects and examine its consequences for innovation outcomes. Using detailed data on pharmaceutical firms' clinical trial projects, we find that trial delays, empirically uncorrelated with multiple project-quality measures, substantially reduce firms' subsequent project-termination propensity. This result remains robust when we use variation in clinical trial site congestion to instrument for unexpected delays. Excess commitment intensifies when CEO compensation has greater stock-price sensitivity and the CEO is responsible for the project's initiation. Our findings have broader implications: delay-driven commitment reduces new drug project initiations, with further evidence suggesting efficiency losses for firms.