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The purpose of this paper is to examine the relationship of CEO compensation plans and the risk of managerial equity portfolios with the extent of strategic investments in advertising, capital expenditures and research and development (R&D). The elements of compensation are salary, bonuses, options and restricted stock grants. The authors proxy the design of CEO equity portfolios by the price performance sensitivity of the holdings and the portfolio deltas.

The authors use the components of executive compensation and portfolio risk as the dependent variables, regressing these against measures for the level of strategic investment. The authors test for non-linear relationships between the components of CEO compensation and strategic investments. The sample is a broad cross-section from 1992 to 2016.

The authors find strong support for non-linear relationships of capital expenditures and R&D with CEO bonuses, option grants and restricted stock grants. There are very complex relationships between the components of executive compensation and R&D expenditures, but little evidence of a relationship with advertising expenditures. The authors also find strong complex relationships in the design of CEO equity portfolios with advertising and R&D.

Little earlier research has considered advertising, capital expenditures and R&D in a unified framework. Also, testing for non-linear associations provides much greater insight into the relationship between the components of executive compensation and strategic investment. The findings represent a valuable incremental contribution to the executive compensation literature. The results also have normative policy implications for compensation committees’ design of optimal annual CEO compensation packages to incentivize or discourage particular strategic investment behavior.

The main purpose of the study is to analyze the impact of research and development (R&D) expenditure on firm performance and firm value in an emerging economy.

In this study, firm performance is examined by firm financial performance (return on asset (ROA) and return on equity (ROE)) and market performance (Tobin's Q (TBQ)). This study conducted a multivariate analysis on the sampled data using pooled ordinary least square (OLS) regression method. In addition, both the level and lagged models have been used to test hypothesis in order to get the results.

All the empirical results from different models found significant and positive association of R&D expenditure with firm performance and firm value. The study also validates that all results are robust and free from outliers and multicollinearity issues.

Most of the studies regarding the R&D expenditure and its impact were conducted on developed countries addressing only firm performance. Whereby, this study examined the impact of R&D expenditure on both firm's financial performance and market performance as well as firm value in the context of an emerging economy.

The outcomes of the study will enable the entrepreneurs, managers, investors and policymakers with more confidence to invest in R&D expenditure that will also ensure the organizational sustainability in the long run.

Most of the prior studies regarding the R&D expenditure and its impact were conducted on developed countries addressing only firm performance. Herein, both firm's financial performance and market performance along with firm value have been analyzed in the context of an emerging economy. This paper is unique empirical research study due to different institutional and regulatory setting as well as corporate characteristics. This study strongly advocates the organizational learning theory, agency theory and resource-based view theory of firms' allocation of funds for future growth and innovation.

The purpose of this paper is to empirically investigate the influence of corporate governance variables relating to the board of directors, audit and ownership on the agency problems that inflict a firm's investments in capital and research and development (R&D) expenditures. This study posits that the R&D investments are inflicted by the agency problem of “quiet life” whereas “empire-building” agency problem affects capital expenditure decisions.

This study analyses the investment behaviour of non-financial and non-utility firms listed on NIFTY 200 from FY 2009 to FY 2018 using a static and dynamic model.

The results from the static model suggest that ownership concentration mitigates the agency problem of the “quiet life” that affects R&D expenditures. However, no corporate governance attribute has a significant impact on R&D investments under the assumption of the dynamic model. In respect of capital expenditures, the analysis of static model yields that audits by large auditor firms and usage of non-audit services ameliorate the agency problem of “empire-building”. The results from the dynamic model show that independent boards worsen it. They also continue to provide empirical evidence in favour of large auditors.

This paper contributes to the literature on the corporate governance-investment association by simultaneously examining the impact of multiple corporate governance attributes on the agency problems of “quiet life” and “empire-building” that affect R&D and capital expenditures, respectively, in a static and dynamic context for a sample of Indian firms.

This study aims to investigate the effect of intangible capital (e.g. intangible investments and research and development (R&D) expenditures) on future profitability in an emerging economy and the moderating role of economic policy uncertainty (EPU) for companies listed on the Tehran Stock Exchange.

To this aim, information about 210 companies during 2014–2021 was collected. This study calculated EPU based on the inflation rate, interest rate, exchange rate and economic growth.

The results showed that both R&D expenditures and other intangible investments positively affect future profitability. Moreover, EPU decreases the positive effect of R&D expenditures and other intangible investments on future profitability. Hypothesis testing based on ordinary least squares and generalized method of moments regressions confirmed these results. This study emphasizes the urgent need to adjust how they operate the business during the COVID-19 pandemic.

The nature and degree of intangible assets and R&D expenditures in firms in emerging markets is an interesting area of research. However, empirical studies in this area have not led to any unanimous conclusion in emerging markets. Moreover, intangible assets and R&D expenditures become very important in the economy affected by the financial crisis and conditions of uncertainties. In light of the COVID-19 crisis, significant changes occurred at all levels and affected accounting-related issues, and the present study highlighted COVID-19. The findings of this research will not only help the managers of companies in developing countries but also, because of the dearth of similar research, they can help managers in developed countries and the global community.

Emerging economies have been highlighted as an important growth source of the global economy. However, this group of countries has not received enough academic attention yet. Therefore, this study aims to identify the impact of research and development (R&D) expenditure on economic growth in emerging economies.

The theoretical framework of the production function is applied to quantitatively analyse the impact of R&D expenditure on economic growth with a sample of 29 emerging economies in the period between 1996 and 2019.

The panel cointegration test confirms the existence of long-run cointegration relationships between economic growth and independent variables in these emerging economies. Besides, the estimated results show that the national R&D expenditure has positive effects on economic growth from both direct and interaction dimensions. This evidence has filled the empirical research gap in the R&D-growth nexus in the case of emerging economies. Finally, while gross capital and education have positive impacts on growth, corruption has a harmful effect on economic growth in these countries.

The results highlight that policymakers should enhance R&D expenditure and R&D activities as the key national development strategy. The investment in R&D not only helps emerging economies avoid the middle-income trap but also pushes these countries to successfully join the group of developed countries.

To the best of the authors’ knowledge, this research is among the first to examine the impact of R&D expenditure on economic growth with a homogeneous sample of emerging economies. The results are obviously helpful for policymakers to use R&D as the key development strategy for supporting economic growth in emerging economies in the future.

Employing the anti-corruption campaign as an exogenous political shock, this paper examines how political intervention shapes the impact of financial expert CEOs on firm investment decisions.

This paper uses a sample of 2,808 Chinese firms listed in the Shanghai and Shenzhen Stock Exchanges from 2003 to 2016. Panel data is used for conducting the analysis controlling for firm, industry, and year fixed effects.

The authors found that CEOs with financial expertise are sensitive to political intervention when making investment decisions. First, financial expert CEOs spend more on R&D expenditure in private-owned companies and they are associated with less R&D expenditure in state-owned enterprises (SOEs). Second, financial expert CEOs are associated with higher investment expenditure in general, but they become less likely to invest more in the post-anti-corruption period. The reduction in investment expenditure due to the anti-corruption campaign is more pronounced in SOEs than in private-owned companies. Third, the anti-corruption campaign promotes R&D investment in general, but in SOEs, expert CEOs tend to be less likely to invest more on R&D after the anti-corruption shock.

This paper enriches the growing literature on the impact of political intervention and the role of the anti-corruption campaign on corporate behaviour.

The purpose of this paper is to analyse the role that different financial sources and financial specialization have on private research and development (R&D) activity in OECD countries.

The authors developed several panel regressions choosing as a final model a two-way random effects regression to understand which funding sources are related to the R&D expenditure, and how financial specialization has links to the private portion of R&D aggregated expenditure. The authors include data from the years 2000 to 2016 for OECD countries.

The results reinforce the critical role that stock markets have in enhancing private R&D and that bond markets have an inverse relationship with private R&D national expenditures. The authors do not find evidence of a link between bank sources and private R&D. Specialized financial systems (banking or market) support innovation in a better way than a mixed arrangement of those two systems.

The findings of this study have considerable policy implications. Policymakers need to be aware of these results, given that some variables related to financial markets, seems to boost the inputs for R&D. In the long term, this could be a signal that national and regional systems of innovation need a broad view of the factors hampering scientific activity, and also a signal that there are other ways to impact the results of the complex innovation activity through the development of stronger financial systems backing up national systems of innovation.

The authors found that the long discussion about the financial system that a country has to choose to enhance growth with R&D&I may have been misleading the public policy. The findings show that rather than a bank or a stock market financial system, economies looking to boost R&D&I, must specialize in one of the two systems, deepen these and generate the appropriate policies to promote science, technology and innovation using those financial markets.

This study carries out an ex - post evaluation of the Research and Development (R&D) Tax Incentive Law in Chile.

A subset of data from the 9th Innovation Survey is chosen, specifically those that were available for the years 2013 and 2014. Then, differences in differences (DID) and matching with differences in differences (MDID) techniques are used to identify the impact of this policy.

The results obtained allow us to affirm that the use of the R&D Tax Incentive Law had some positive but very low effects on some components of expenditure for innovation. Also, the positive effect of the tax credits on the total expenditure for innovation identified with MDID disappears when only firms that know the R&D Tax Incentive Law are used as a control group.

This work provides new evidence to evaluate innovation policies in Latin America, focusing on tax credits that have been much less studied than subsidy programs. Specifically, it is concluded that there is still a wide margin to improve and reformulate the R&D Tax Incentive Law in Chile.

Este estudio realiza una evaluación ex - post de la Ley de Incentivo Tributario para la Investigación y Desarrollo (I+D) en Chile.

Se escogió un subconjunto de datos de la 9a Encuesta de Innovación, específicamente aquellos que estaban disponibles para los años 2013 y 2014. Luego, se aplicaron las metodologías de diferencias en diferencias (DID) y matching con diferencias en diferencias (MDID) para identificar el impacto de esta política.

Los resultados obtenidos permiten afirmar que el uso de la Ley de Incentivo Tributario para la I+D tuvo algunos efectos positivos, pero bastante bajos en algunos componentes del gasto en innovación. Además, el efecto positivo del incentivo tributario sobre el gasto total en innovación identificado con MDID desaparece cuando se utiliza como grupo de control solamente a las firmas que conocen la ley.

Este trabajo aporta evidencia nueva para evaluar las políticas de innovación en Latinoamérica, enfocándose en los créditos tributarios que han sido mucho menos estudiados que los programas de subsidio. Específicamente, se concluye que existe todavía un amplio margen para mejorar y reformular la Ley de Incentivo Tributario para la I+D en Chile.

This chapter sheds light on long-term trends in the level and structural dynamics of investments in Russian human capital formation from government, corporations, and households. It contributes to the literature discussing theoretical issues and empirical patterns of modernization, human development, as well as the transition from a centralized to a market economy. The empirical evidence is based on extensive utilization of the dataset introduced in Didenko, Földvári, and Van Leeuwen (2013). Our findings provide support for the view expressed in Gerschenkron (1962) that in late industrializers the government tended to substitute for the lack of capital and infrastructure by direct interventions. At least from the late nineteenth century the central government's and local authorities' budgets played the primary role. However, the role of nongovernment sources increased significantly since the mid-1950s, i.e., after the crucial breakthrough to an industrial society had been made. During the transition to a market economy in the 1990s and 2000s the level of government contributions decreased somewhat in education, and more significantly in research and development, but its share in overall financing expanded. In education corporate funds were largely replaced by those from households. In health care, Russia is characterized by an increasing share of out-of-pocket payments of households and slow development of organized forms of nonstate financing. These trends reinforce obstacles to Russia's future transition, as regards institutional change toward a more significant and sound role of the corporate sector in such branches as R&D, health care, and, to a lesser extent, education.

The purpose of this paper is to examine the impact of research and development (R&D) tax credit scheme on participating firm’s R&D expenditure in Indian manufacturing firms.

Tobit model is used to estimate the impact of R&D tax credit scheme on R&D expenditure.

The results suggest that there is a positive and significant effect of R&D tax incentive scheme on R&D. The introduction of the R&D tax credit scheme and the policy amendment are positively influencing R&D investment of the participating firms. However, industry-specific results suggest that these positive results are mainly driven by electronic and pharmaceutical industries. The study reveals that import of technology, import of raw materials, competition, profitability, age and leverage position of the firm also positively influence the R&D intensity of the firm.

The study is limited to the listed manufacturing firms in India.

The study evaluates the innovation policy to help the policymakers in designing an effective policy.

The paper provides evidence on the impact of R&D tax incentive scheme on firm innovation to explain the factors that contribute to the R&D expenditure of the participating firms. It also summarises the effectiveness of tax incentive scheme on different industry groups and firm size.