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Religion, gambling attitudes and corporate innovation

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  • Adhikari, Binay Kumar
  • Agrawal, Anup

Abstract

We find that firms headquartered in areas with a taste for gambling tend to be more innovative, i.e. they spend more on R&D, and obtain more and better quality patents. These results are supported by several robustness checks, tests to mitigate identification concerns, and analyses of several secondary implications. Investment in innovation makes a stock more lottery-like, a feature desired by individuals with a taste for gambling. Gambling preferences of both local investors and managers appear to influence firms' innovative endeavors and facilitate transforming their industry growth opportunities into firm value.

Suggested Citation

  • Adhikari, Binay Kumar & Agrawal, Anup, 2016. "Religion, gambling attitudes and corporate innovation," Journal of Corporate Finance, Elsevier, vol. 37(C), pages 229-248.
    • Handle: RePEc:eee:corfin:v:37:y:2016:i:c:p:229-248
    DOI: 10.1016/j.jcorpfin.2015.12.017
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    More about this item

    Keywords

    Local gambling attitudes; Corporate innovation; R&D; Patents;
    All these keywords.

    JEL classification:

    • G30 - Financial Economics - - Corporate Finance and Governance - - - General
    • L26 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Entrepreneurship

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