The moderation effect of slack resources on the relationships between CEO characteristics and R&D expenditures
by Ching-Wen Chen; Chin-Tsang Ho; Tsung-Che Tsai
International Journal of Business and Systems Research (IJBSR), Vol. 7, No. 4, 2013

Abstract: There are many references globally supporting the notion that innovation can raise the competitiveness of a firm, and that R&D expenditure is an appropriate measurement of innovation. The purpose of this paper is to investigate the relationship between a CEO's demographic characteristics and R&D expenditure. Considering the function of slack resources on incentive, risk buffer and strategy facilitation, this paper incorporates the slack resources variable into the relation between CEO characteristics and R&D expenditure. Slack resources have the ability to absorb losses caused by failures, which then increase the organisation's willingness to engage in risk-taking behaviour. The results reveal that CEOs with older age or higher education degree would consider if firm's resources are available or not when they invest R&D in technological industries. However, slack resources have no significant moderating effect on the relationships between CEOs with an engineering education background, shareholding and R&D expenditures.

Online publication date: Thu, 28-Nov-2013

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