The moderation effect of slack resources on the relationships between CEO characteristics and R%D expenditures

Ching-Wen Chen, Chin-Tsang Ho and Tsung-Che Tsai

International Journal of Business and Systems Research, 2013, vol. 7, issue 4, 357-374

Abstract: There are many references globally supporting the notion that innovation can raise the competitiveness of a firm, and that R%D expenditure is an appropriate measurement of innovation. The purpose of this paper is to investigate the relationship between a CEO's demographic characteristics and R%D expenditure. Considering the function of slack resources on incentive, risk buffer and strategy facilitation, this paper incorporates the slack resources variable into the relation between CEO characteristics and R%D expenditure. Slack resources have the ability to absorb losses caused by failures, which then increase the organisation's willingness to engage in risk-taking behaviour. The results reveal that CEOs with older age or higher education degree would consider if firm's resources are available or not when they invest R%D in technological industries. However, slack resources have no significant moderating effect on the relationships between CEOs with an engineering education background, shareholding and R%D expenditures.

Keywords: R%D expenditure; CEO characteristics; slack resources; demographic characteristics; technological industry; technical innovation; research and development; firm performance; incentives; risk buffers; strategy facilitation; age; education background; moderating effect; engineering education; shareholding. (search for similar items in EconPapers)
Date: 2013
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