IDEAS home Printed from https://ideas.repec.org/a/taf/jbemgt/v15y2014i2p369-383.html
   My bibliography  Save this article

Organizational slack effects on innovation: the moderating roles of CEO tenure and compensation

Author

Listed:
  • Fariss-Terry Mousa
  • Jaideep Chowdhury

Abstract

This study draws on upper echelons theory, the resource based view, and Penrose's theory of firm growth to show that slack resources, specifically financial and human slack, are essential to the research and development (R&D) strategies of organizations. We also suggest that both Chief Executive Officer (CEO) tenure and CEO compensation positively moderate the slack-innovation relationship.The empirical design compromised of panel regression analysis. We tested our hypotheses using all US publicly traded firms between 1993 and 2011.The research results show that firms with excess financial resources are more likely to have higher R&D investments, and to completely understand this relationship we must study CEO tenure and compensation.This study sheds light on central antecedents of firm innovation, it further extends our understanding by investigating the impact of CEO tenure and compensation on the slackinnovation relationship, and it applies a longitudinal design which answers previous calls to investigate this topic in more depth by offering enhanced stability to the results while allowing for different economic scenarios.

Suggested Citation

  • Fariss-Terry Mousa & Jaideep Chowdhury, 2014. "Organizational slack effects on innovation: the moderating roles of CEO tenure and compensation," Journal of Business Economics and Management, Taylor & Francis Journals, vol. 15(2), pages 369-383, April.
    • Handle: RePEc:taf:jbemgt:v:15:y:2014:i:2:p:369-383
    DOI: 10.3846/16111699.2013.839476
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.3846/16111699.2013.839476
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.3846/16111699.2013.839476?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Esther B. Brio & Ilidio Lopes-e-Silva & Javier Perote, 2016. "Effects of opportunistic behaviors on security markets: an experimental approach to insider trading and earnings management," Economia Politica: Journal of Analytical and Institutional Economics, Springer;Fondazione Edison, vol. 33(3), pages 379-402, December.
    2. Stavros Kourtzidis & Nickolaos G. Tzeremes, 2019. "Investigating the determinants of firm performance," European Journal of Management and Business Economics, Emerald Group Publishing Limited, vol. 29(1), pages 3-22, June.
    3. van Uden, A. & Knoben, J. & Vermeulen, P.A.M., 2014. "Human Capital and Innovation in Developing Countries : A Firm Level Study," Other publications TiSEM be3956d2-96d6-4cda-bf28-d, Tilburg University, School of Economics and Management.
    4. Michael Sheppard, 2020. "The relationship between discretionary slack and growth in small firms," International Entrepreneurship and Management Journal, Springer, vol. 16(1), pages 195-219, March.
    5. Jinguo Zhao & Huanxin Liu & Wei Sun, 2020. "How Proactive Environmental Strategy Facilitates Environmental Reputation: Roles of Green Human Resource Management and Discretionary Slack," Sustainability, MDPI, vol. 12(3), pages 1-15, January.
    6. Adamu Jibir & Musa Abdu, 2021. "Human Capital and Propensity to Protect Intellectual Properties as Innovation Output: the Case of Nigerian Manufacturing and Service Firms," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 12(2), pages 595-619, June.
    7. Raghavan J. Iyengar & Malavika Sundararajan, 2019. "Is Firm Innovation Associated With Corporate Governance?," International Journal of Innovation Management (ijim), World Scientific Publishing Co. Pte. Ltd., vol. 24(03), pages 1-24, April.
    8. Andreea N. Kiss & Stephanie Fernhaber & Patricia P. McDougall–Covin, 2018. "Slack, Innovation, and Export Intensity: Implications for Small– and Medium–Sized Enterprises," Entrepreneurship Theory and Practice, , vol. 42(5), pages 671-697, September.
    9. Yuen, Kum Fai & Wang, Xueqin & Wong, Yiik Diew & Ma, Fei, 2019. "A contingency view of the effects of sustainable shipping exploitation and exploration on business performance," Transport Policy, Elsevier, vol. 77(C), pages 90-103.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:taf:jbemgt:v:15:y:2014:i:2:p:369-383. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Chris Longhurst (email available below). General contact details of provider: http://www.tandfonline.com/TBEM20 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.