Management equity incentives, market dynamics, and corporate R&D investment

Chun Hu, Haoyang He, Fei Wang and Yeon-Soo Shin

Finance Research Letters, 2025, vol. 76, issue C

Abstract: This paper utilizing data from Chinese listed companies spanning 2009 to 2021, to analyzes the link between management equity incentives, market dynamics, and corporate R&D investment. The study shows that management equity incentives significantly increase both R&D expenditures and the number of R&D personnel within firms. This equity incentive mechanism indirectly promotes R&D activities by alleviating financing constraints, which further enhances market dynamics. Moreover, there are differences in the response to equity incentives based on property rights, highlighting that equity incentive strategies should consider firm type characteristics. These findings provide important empirical support for policymakers and corporate management in designing effective equity incentive policies.

Keywords: Management Equity Incentives; Market Dynamics; R&D Investment; Market Liquidity; Financing Constraints (search for similar items in EconPapers)
JEL-codes: D22 G32 M12 O31 O32 (search for similar items in EconPapers)
Date: 2025
References: Add references at CitEc
Citations:

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S1544612325002624
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:76:y:2025:i:c:s1544612325002624

DOI: 10.1016/j.frl.2025.106998

Access Statistics for this article

Finance Research Letters is currently edited by R. Gençay

More articles in Finance Research Letters from Elsevier
Bibliographic data for series maintained by Catherine Liu ().