We show that the similarity of a firm's technological expertise with other firms affects outcomes in the managerial labor market. Using each firm's patent portfolio to estimate its technological expertise, we find that its similarity in technological expertise with other firms is strongly...

This paper examines the optimal incentive scheme in motivating people to innovate under ambiguity. When an innovation's prospects are ambiguous, the use of extrinsic, high-powered incentives can lead the agent's beliefs about the project's outcome to deviate from that of the principal's, which...