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Article
Myopic Investor or Active Monitor? The Role of Institutional Investors in Corporate Innovation
International Journal of Financial Research (2015)
  • Xiaoyan Xu, San Jose State University
  • Chunlei Wang, San Jose State University
  • Shijun Cheng, University of Maryland at College Park
Abstract
We examine the role of institutional investors in firms’ innovation strategies. We find that although institutional shareholding is positively related to the likelihood of patenting, it is not related to firms’ exploratory innovation activities. Moreover, the presence of a block institutional holder or the holding by long-term investors has strong negative effect on exploratory innovations. Our study provides new insights to the role of institutional investors in firms’ innovation decisions.
Keywords
  • institutional investors,
  • corporate governance,
  • exploratory innovation,
  • patents
Publication Date
2015
DOI
10.5430/ijfr.v6n2p23
Publisher Statement
This article originally appeared in the International Journal of Financial Research, volume 6, issue 2, 2015, and can be found at this link.
Citation Information
Xiaoyan Xu, Chunlei Wang and Shijun Cheng. "Myopic Investor or Active Monitor? The Role of Institutional Investors in Corporate Innovation" International Journal of Financial Research Vol. 6 Iss. 2 (2015) p. 23 - 32 ISSN: 1923-4023
Available at: http://works.bepress.com/chunlei_wang/16/
Creative Commons license
Creative Commons License
This work is licensed under a Creative Commons CC_BY International License.