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Two Essays on Corporate Innovation.

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Title:Two Essays on Corporate Innovation.
Authors:Qiu, Bin
Contributors:Business Administration (department)
Keywords:corporate innovation
pension
institutional ownership
common ownership
Date Issued:Aug 2017
Publisher:University of Hawaiʻi at Mānoa
Abstract:In Part I of this dissertation, I exploit a natural experiment of tax-qualified defined benefit
(DB) plans to identify the effects of deferred compensation on corporate innovation.
Using DB pension and patenting data, I find that from 1990 to 2007, firms with higher DB
plan value secured more patents and patent citations. An instrumental variable
approach and a treatment effects model both support the causal effect of DB plans on
corporate innovation. Consistent with the worker-firm bonding theory, my findings
suggest the bright side of DB plans despite recent pension freezes. Further analysis
reveals that non-qualified executive pensions weaken the above effect. Overall, I
provide a positive answer to an important economic question: whether secured deferred
compensation promotes corporate innovation among the rank and file employees. Part II
tests how ownership structure affects corporate innovation. The prior literature
documents a positive effect that the fraction of the firm held by institutional investors has
on corporate innovation. I focus on the fraction of the institution's portfolio represented
by the firm and find that institutions’ portfolio weights positively affect patent success. Yet,
it is important to distinguish between cross-industry diversification and same-industry
diversification of monitoring institutions. I provide evidence that the former fosters
innovation, while the latter, if it creates common ownership, impedes innovation. I
address endogeneity issues with multiple methods, including regression discontinuity
design, instrumental variable approach, and difference-in-differences analysis.
Description:Ph.D. Thesis. University of Hawaiʻi at Mānoa 2017.
URI:http://hdl.handle.net/10125/62227
Rights:All UHM dissertations and theses are protected by copyright. They may be viewed from this source for any purpose, but reproduction or distribution in any format is prohibited without written permission from the copyright owner.
Appears in Collections: Ph.D. - Business Administration


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