Social injustice and corporate innovation

Aslihan Gizem Korkmaz and Erdem Ucar

The Quarterly Review of Economics and Finance, 2025, vol. 101, issue C

Abstract: We investigate the role of local social injustice, measured by racial prejudice and sexism, in corporate innovation. In a sample of U.S. firms, we find that local racial prejudice and sexism negatively affect corporate innovation. The results remain robust after the inclusion of other unobserved local factors. Furthermore, we find that the firms located in states with higher sexism levels continue to have lower corporate innovation outputs in the leading two and three years. The empirical findings imply that social injustice does not only have a social cost but also has economic consequences for firms.

Keywords: Social Injustice; Racial prejudice; Sexism; Corporate innovation (search for similar items in EconPapers)
JEL-codes: G30 M14 O30 (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:quaeco:v:101:y:2025:i:c:s1062976925000225

DOI: 10.1016/j.qref.2025.101981

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