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| The Research on the Effect of Managerial Ownership on the Persistence of Firm Innovation |
| Le Yiting1,Li Huihui2,Li Jian1 |
| 1.Business School,Nanjing Normal University,Nanjing 210023,China;2.Institute of Education,Nanjing University,Nanjing 210093,China |
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Abstract The interruption of innovation activities will lead to huge adjustment cost. Thus, how to maintain the continuity of enterprise innovation is an important issue for the research of enterprise innovation. Combining the principal-agent theory, this paper researches the impact of managerial ownership on the persistence of firm innovation, and further discuss the context effects of executive overconfidence and the ownership. Using the panel data of a share companies in manufacturing industry between 2003 and 2014, it finds that managerial ownership can make positive effect on the persistence of firm innovation and executive overconfidence can weaken this positive relationship. Compared to non-private enterprises, the relationship between managerial ownership and the persistence of firm innovation is more significant in the private enterprises. In addition, considering the combined effects of two adjustment variables at the same time, it finds that the context effect of executive overconfidence is stronger in the private enterprises. This paper not only gives suggestions for firms to improve the system of executive management, but also provides references for our governments to formulate policies more directionally.
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Received: 14 June 2016
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Corresponding Authors:
Le Yiting
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