Share repurchases and firm innovation

Lily Nguyen, Le Vu, Xiangkang Yin

Research output: Contribution to journalArticleResearchpeer-review

Abstract

We examine whether corporate decisions such as share repurchases influence a firm’s intangible assets and their production. We find a significantly negative relationship between share repurchases and firm innovation. The negative relationship survives all considered robustness tests. We further apply two identification strategies, namely, difference-in-differences analysis and instrumental variables estimation, to establish that the negative effect is causal; that is, from share repurchases to innovation.

Original languageEnglish
Number of pages31
JournalAccounting & Finance
DOIs
Publication statusAccepted/In press - 2020

Keywords

  • Citations
  • Innovation
  • Patents
  • Share repurchases

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