Do general managerial skills spur innovation?

Research output: Contribution to journalArticle

14 Citations (Scopus)
2 Downloads (Pure)

Abstract

We show that firms with chief executive officers (CEOs) who gain general managerial skills over their lifetime of work experience produce more patents.We address the potential endogenous CEO-firm matching bias using firm-CEO fixed effects and variation in the enforceability of noncompete agreements across states and over time during the CEO's career. Our findings suggest that generalist CEOs spur innovation because they acquire knowledge beyond the firm's current technological domain, and they have skills that can be applied elsewhere should innovation projects fail. We conclude that an efficient labor market for executives can promote innovation by providing a mechanism of tolerance for failure.

Original languageEnglish
Pages (from-to)459-476
Number of pages18
JournalManagement Science
Volume65
Issue number2
DOIs
Publication statusPublished - 1 Feb 2019

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Chief executive officer
Innovation
Managerial skills
Patents
Tolerance
Work experience
Labour market
Fixed effects

Keywords

  • General human capital
  • Innovation
  • Patents
  • R&D
  • Risk taking

Cite this

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title = "Do general managerial skills spur innovation?",
abstract = "We show that firms with chief executive officers (CEOs) who gain general managerial skills over their lifetime of work experience produce more patents.We address the potential endogenous CEO-firm matching bias using firm-CEO fixed effects and variation in the enforceability of noncompete agreements across states and over time during the CEO's career. Our findings suggest that generalist CEOs spur innovation because they acquire knowledge beyond the firm's current technological domain, and they have skills that can be applied elsewhere should innovation projects fail. We conclude that an efficient labor market for executives can promote innovation by providing a mechanism of tolerance for failure.",
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Do general managerial skills spur innovation? / Custódio, Cláudia; Ferreira, Miguel A.; Matosc, Pedro.

In: Management Science, Vol. 65, No. 2, 01.02.2019, p. 459-476.

Research output: Contribution to journalArticle

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T1 - Do general managerial skills spur innovation?

AU - Custódio, Cláudia

AU - Ferreira, Miguel A.

AU - Matosc, Pedro

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