Does managerial ability facilitate corporate innovative success?

Yangyang Chen, Edward Podolski-Boczar, Madhu Veeraraghavan

    Research output: Contribution to journalArticleResearchpeer-review

    18 Citations (Scopus)

    Abstract

    This paper examines whether managerial ability facilitates corporate innovative success. First, we show that managerial ability is positively associated with innovative output. Second, we show that the positive association between managerial ability and innovative output is weaker for older CEOs and managers who stay in the same job for longer, suggesting a preference for a quiet life by long serving CEOs. Third, we find that the equity market values patents generated by more able managers more positively, suggesting that equity holders deem better skilled managers more effective at converting innovative ideas into valuable new products. Finally, we show that managerial ability is positively associated with more radical innovations, which are outside of the firm s knowledge base. Overall, our results suggest that managerial ability is an essential component of corporate innovative success.
    Original languageEnglish
    Pages (from-to)313 - 326
    Number of pages14
    JournalJournal of Empirical Finance
    Volume34
    DOIs
    Publication statusPublished - 2015

    Cite this

    Chen, Yangyang ; Podolski-Boczar, Edward ; Veeraraghavan, Madhu. / Does managerial ability facilitate corporate innovative success?. In: Journal of Empirical Finance. 2015 ; Vol. 34. pp. 313 - 326.
    @article{2b465fdbbd4e467dbe50da45a04d3cee,
    title = "Does managerial ability facilitate corporate innovative success?",
    abstract = "This paper examines whether managerial ability facilitates corporate innovative success. First, we show that managerial ability is positively associated with innovative output. Second, we show that the positive association between managerial ability and innovative output is weaker for older CEOs and managers who stay in the same job for longer, suggesting a preference for a quiet life by long serving CEOs. Third, we find that the equity market values patents generated by more able managers more positively, suggesting that equity holders deem better skilled managers more effective at converting innovative ideas into valuable new products. Finally, we show that managerial ability is positively associated with more radical innovations, which are outside of the firm s knowledge base. Overall, our results suggest that managerial ability is an essential component of corporate innovative success.",
    author = "Yangyang Chen and Edward Podolski-Boczar and Madhu Veeraraghavan",
    year = "2015",
    doi = "10.1016/j.jempfin.2015.08.002",
    language = "English",
    volume = "34",
    pages = "313 -- 326",
    journal = "Journal of Empirical Finance",
    issn = "0927-5398",
    publisher = "Elsevier",

    }

    Does managerial ability facilitate corporate innovative success? / Chen, Yangyang; Podolski-Boczar, Edward; Veeraraghavan, Madhu.

    In: Journal of Empirical Finance, Vol. 34, 2015, p. 313 - 326.

    Research output: Contribution to journalArticleResearchpeer-review

    TY - JOUR

    T1 - Does managerial ability facilitate corporate innovative success?

    AU - Chen, Yangyang

    AU - Podolski-Boczar, Edward

    AU - Veeraraghavan, Madhu

    PY - 2015

    Y1 - 2015

    N2 - This paper examines whether managerial ability facilitates corporate innovative success. First, we show that managerial ability is positively associated with innovative output. Second, we show that the positive association between managerial ability and innovative output is weaker for older CEOs and managers who stay in the same job for longer, suggesting a preference for a quiet life by long serving CEOs. Third, we find that the equity market values patents generated by more able managers more positively, suggesting that equity holders deem better skilled managers more effective at converting innovative ideas into valuable new products. Finally, we show that managerial ability is positively associated with more radical innovations, which are outside of the firm s knowledge base. Overall, our results suggest that managerial ability is an essential component of corporate innovative success.

    AB - This paper examines whether managerial ability facilitates corporate innovative success. First, we show that managerial ability is positively associated with innovative output. Second, we show that the positive association between managerial ability and innovative output is weaker for older CEOs and managers who stay in the same job for longer, suggesting a preference for a quiet life by long serving CEOs. Third, we find that the equity market values patents generated by more able managers more positively, suggesting that equity holders deem better skilled managers more effective at converting innovative ideas into valuable new products. Finally, we show that managerial ability is positively associated with more radical innovations, which are outside of the firm s knowledge base. Overall, our results suggest that managerial ability is an essential component of corporate innovative success.

    U2 - 10.1016/j.jempfin.2015.08.002

    DO - 10.1016/j.jempfin.2015.08.002

    M3 - Article

    VL - 34

    SP - 313

    EP - 326

    JO - Journal of Empirical Finance

    JF - Journal of Empirical Finance

    SN - 0927-5398

    ER -