In the mood for creativity: Sunshine-induced mood, inventor performance, and firm value

Yangyang Chen, Po-Hsuan Hsu, Edward J. Podolski and Madhu Veeraraghavan

Journal of Empirical Finance, 2024, vol. 78, issue C

Abstract: We investigate how firm value may be related to emotional and mental states of innovative workers via the innovation channel. By analyzing a comprehensive inventor-level dataset, we discover that the economic value inventors produce for their firms through their patenting activity is positively associated with their sunshine-induced mood. This augmentation in patent value is not due to a surge in the quantity of patents, but rather to the heightened significance and influence of the created inventions. These inventor-level observations aggregate to the firm level. The observed sunshine-enhanced effect is of a magnitude comparable to other primary behavioral drivers of innovation outcomes, such as CEO overconfidence and CEO thrill-seeking tendencies. Our research underscores the significance of the emotional and psychological states of innovative personnel that has implications for managers and shaerholders.

Keywords: Mood; Inventor performance; Innovation; Creativity (search for similar items in EconPapers)
JEL-codes: G39 J33 M52 O31 (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:eee:empfin:v:78:y:2024:i:c:s0927539824000628

DOI: 10.1016/j.jempfin.2024.101527

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