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Keywords

executive incentive, risk-taking, mediating effect, innovation

Abstract

We take Shanghai and Shenzhen A-share listed companies from 2006 to 2019 as samples,and use the USES multiple linear regression model to study the influence of executive incentive on enterprise innovation,and investigates the mediating role of risk taking in the process of executive incentive and innovation.The results show that executive incentives have a positive effect on the intensity of enterprises innovation.Both short-term incentives and long-term incentives can significantly promote the enterprise's innovation.In order to obtain expected earnings,motivated executives will pay more attention to the volatility of the company's stock price,which makes executives show the tendency of risk aversion and reduce risk taking when making decisions.Risk-taking plays an intermediary role in the incentive of executives and the intensity of innovation.And risk-taking masks part of positive influence on the incentive of executives to the intensity of innovation.It is show that stimulated executives tend to avoid risks,thus undermining the willingness to invest in innovation projects.This research explains the path of executive incentives on enterprise innovation activities,and provides policy suggestions for enterprises to reasonably formulate incentive policies which effectively promote enterprise's innovation activities.

DOI

10.16315/j.stm.2020.05.009

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