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Female political leaders and R&D investment

Author

Listed:
  • Guan, Yuexin
  • Pan, Wei-Fong
  • Tang, Siyu

Abstract

This study employs a difference-in-differences method to analyse how female political leaders affect corporate R&D investment. Our findings indicate that female political leaders exert a positive influence on R&D investments. Moreover, these positive effects are more pronounced among high-tech firms and those operating in developed economies, although they appear to be less significant for defence firms. Additionally, we demonstrate that the presence of female leaders correlates with a reduced rate of inventor emigration to other economies, suggesting that female leadership may contribute to the retention of skilled inventors. Consistent with these primary results, firms exhibit a decrease in R&D investment following the departure of female political leaders from office. Furthermore, during the tenure of female leaders, firms also tend to reduce their cash holdings. We explore potential channels and observe that female leadership results in less external conflict and thus promote R&D investment.

Suggested Citation

  • Guan, Yuexin & Pan, Wei-Fong & Tang, Siyu, 2024. "Female political leaders and R&D investment," Research in International Business and Finance, Elsevier, vol. 70(PB).
  • Handle: RePEc:eee:riibaf:v:70:y:2024:i:pb:s0275531924001892
    DOI: 10.1016/j.ribaf.2024.102396
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    More about this item

    Keywords

    Political economy; Female leaders; Corporate investment; R&D investment; Conflicts;
    All these keywords.

    JEL classification:

    • D70 - Microeconomics - - Analysis of Collective Decision-Making - - - General
    • G31 - Financial Economics - - Corporate Finance and Governance - - - Capital Budgeting; Fixed Investment and Inventory Studies
    • H19 - Public Economics - - Structure and Scope of Government - - - Other
    • H50 - Public Economics - - National Government Expenditures and Related Policies - - - General
    • O32 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Management of Technological Innovation and R&D

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