Are Founder-CEOs Better Innovators?

Posted: 13 Mar 2014 Last revised: 14 May 2014

See all articles by Kourosh Shafi

Kourosh Shafi

California State University, East Bay

Date Written: March 12, 2014

Abstract

Founder-CEOs invest more in R&D projects. My findings suggest this is an over- investment problem since founder-CEO firms are less able to obtain patents and future citations per patent compared to non-founder CEO firms. Using instrumental variables, I argue that the negative effect of founder-CEOs on innovation is causal. The findings are consistent with a lazy manager hypothesis; the negative relationship between innovation and founder-CEO is weaker when product market competition is more intense and/or when CEO is less “entrenched”.

Keywords: Founder-CEO, Innovation

JEL Classification: G30

Suggested Citation

Shafi, Kourosh, Are Founder-CEOs Better Innovators? (March 12, 2014). Available at SSRN: https://ssrn.com/abstract=2408171

Kourosh Shafi (Contact Author)

California State University, East Bay ( email )

25800 Carlos Bee Boulevard
Hayward, CA California 94542
United States

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