Beyer, Mila; Czarnitzki, Dirk; Kraft, Kornelius - 2013
Principle-agent theory suggests managers might under-invest into R&D for reasons of risk tied to project failure, such … company shares under-invest into R&D compared to owners giving rise to the risk argument. Second, we find an inverse u …-shaped relationship between the degree of managerial ownership and R&D. Thus, managers become entrenched, i.e. powerful enough to pursue …