Executive Compensation Incentives, Analyst Attention, and Firms’ Investment in Innovation

Jia Xu () and Chenying Zhao
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Jia Xu: Sichuan Agricultural University, Business and Tourism School
Chenying Zhao: Sichuan Agricultural University, Business and Tourism School

A chapter in Proceedings of the 2025 3rd International Conference on Digital Economy and Management Science (CDEMS 2025), 2025, pp 507-513 from Springer

Abstract: Abstract Innovation investment is key to high-quality corporate development and should be central to business strategy. Executive compensation incentives not only shape resource allocation but also critically influence innovation efforts. Additionally, analysts, as vital sources of market intelligence, offer oversight and guidance to business decisions. This study examines A-share listed companies to assess how executive pay incentives affect innovation investments and explores the moderating role of analyst attention. The results indicate that higher executive incentives lead to increased innovation investment, an effect that is even stronger under heightened analyst scrutiny. Robustness tests confirm these findings, offering valuable insights for refining compensation policies and shaping innovation strategies.

Keywords: Executive Compensation Incentives; Analyst Focus; Corporate Innovation Investment; Listed Companies (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:spr:advbcp:978-94-6463-770-0_57

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DOI: 10.2991/978-94-6463-770-0_57

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