This paper establishes a model, where up-stream firms 'produce' drastic innovations and down-stream firms specialize in final goods production. A drastic innovation obsolesces the existing technology but down-stream firms can improve it by their incremental innovations. The economy develops in...

This paper establishes a model, where up-stream firms 'produce' drastic innovations and down-stream firms specialize in final goods production. A drastic innovation obsolesces the existing technology but down-stream firms can improve it by their incremental innovations. The economy develops in...

This study examines whether and how audit quality affects a firm's technological innovation. Using a sample of 7,482 U.S. firms between 2000 and 2009, we demonstrate that high audit quality is associated with lower innovation output, measured by patent counts and patent citations. The effect...

This study documents a positive and robust effect of co-opted boards on firm innovation. This effect is mainly driven by co-opted independent directors. Firms with more co-opted independent directors are associated with lower sensitivities of CEO pay-performance and turnover-performance. It...

We examine whether corporate decisions such as share repurchases influence a firm's intangible assets and their production. We find a significantly negative relationship between share repurchases and firm innovation. The negative relationship survives all considered robustness tests. We further...