CEO Tenure?R&D Spending Leap And Firm Performance

Innovation is the primary impetus of development,and the implementation of innovation driven development strategy is an urgent requirement for China and have to be placed in a prominent position.Nowadays innovation driven strategy has risen into our country's strategy.The development of China more and more depends on innovation.Our country's rapid development mainly originated from the low cost advantage of labor in the past forty years of reform and opening-up.When enters into new development period,China's low cost advantage of labor disappear gradually,so we have to rely on innovation to produce new energy.Statistics reveal that enterprises have become the main force of R&D investment,so it is very important to do well in R&D management.We use the data of 302 listed companies in Shanghai and Shenzhen stock exchange from 2007 to 2016,and construct multiple linear regression model to start both of the research of pre-effect from CEO tenure to R&D spending leap,and the research of consequence from R&D spending leap to performance.The results show that 1)upward R&D spending leap and downward R&D spending leap have positive effect on long-term performance and short-term performance respectively,and upward R&D spending leap does not have significant effect on short-term performance,downward R&D spending leap has negative effect on the long-term performance;2)when industry competition intensity is higher,upward R&D spending leap and downward R&D spending leap have negative effect on the corporate short-term performance and long-term performance respectively.and upward R&D spending leap have positive effect on the corporate long-term performance,but industry competition intensity does not have robustly positive moderating effect in the relationship between downward R&D spending leap and short-term performance;3)CEO doesn't want to make upward R&D spending leap when CEO tenure is longer,instead he is willing to make downward R&D spending leap;4)when technological capability is higher,CEO tenure will have positive effect on upward R&D spending leap,and CEO tenure will have positive effect on downward R&D spending leap when technological capability is lower.At the end of this research,we put forward some suggestions on the capital allocation of firm innovation strategy,planning of CEO tenure according to the results of the empirical analysis,and eventually point out the limitations of this study and future prospects.