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Disproportional ownership structures and corporate R&D investment: from the investor protection perspective

Disproportional ownership structures and corporate R&D investment: from the investor protection... Disproportional ownership structures are promised to stimulate innovation. However, very few studies have empirically examined this relationship and compared the dual-class equity structure and stock pyramid structure, two forms of disproportional ownership structures. In this research, from the investor protection perspective by integrating 'contract' and 'legal' perspectives, we explored the impact of disproportional ownership structures on firms' R&D. Using data consisting of Chinese firms with disproportional ownership structures from 2008 to 2018, we found that compared with pyramidal firms, dual-class firms engaged in more R&D investments. We also found that ownership-control rights divergence negatively moderated the dual-class equity structure and R&D investment relationship, while equity restriction further weakened this moderating effect. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png International Journal of Technology Management Inderscience Publishers

Disproportional ownership structures and corporate R&D investment: from the investor protection perspective

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Publisher
Inderscience Publishers
Copyright
Copyright © Inderscience Enterprises Ltd
ISSN
0267-5730
eISSN
1741-5276
DOI
10.1504/ijtm.2023.129564
Publisher site
See Article on Publisher Site

Abstract

Disproportional ownership structures are promised to stimulate innovation. However, very few studies have empirically examined this relationship and compared the dual-class equity structure and stock pyramid structure, two forms of disproportional ownership structures. In this research, from the investor protection perspective by integrating 'contract' and 'legal' perspectives, we explored the impact of disproportional ownership structures on firms' R&D. Using data consisting of Chinese firms with disproportional ownership structures from 2008 to 2018, we found that compared with pyramidal firms, dual-class firms engaged in more R&D investments. We also found that ownership-control rights divergence negatively moderated the dual-class equity structure and R&D investment relationship, while equity restriction further weakened this moderating effect.

Journal

International Journal of Technology ManagementInderscience Publishers

Published: Jan 1, 2023

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