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dc.contributor.author	Zingales, Luigi
dc.contributor.author	Reenen, John Van
dc.contributor.author	Aghion, Philippe
dc.date.accessioned	2010-10-14T13:55:10Z
dc.date.issued	2009
dc.identifier.citation	Aghion, Philippe, John Van Reenen, and Luigi Zingales. 2009. Innovation and Institutional Ownership. NBER Working Paper Series 14769.	en_US
dc.identifier.issn	0898-2937	en_US
dc.identifier.uri	http://nrs.harvard.edu/urn-3:HUL.InstRepos:4481491
dc.description.abstract	We find that institutional ownership in publicly traded companies is associated with more innovation (measured by cite-weighted patents). To explore the mechanism through which this link arises, we build a model that nests the lazy-manager hypothesis with career-concerns, where institutional owners increase managerial incentives to innovate by reducing the career risk of risky projects. The data supports the career concerns model. First, whereas the lazy manager hypothesis predicts a substitution effect between institutional ownership and product market competition (and managerial entrenchment generally), the career-concern model allows for complementarity. Empirically, we reject substitution effects. Second, CEOs are less likely to be fired in the face of profit downturns when institutional ownership is higher. Finally, using instrumental variables, policy changes and disaggregating by type of owner we find that the effect of institutions on innovation does not appear to be due to endogenous selection.	en_US
dc.description.sponsorship	Economics	en_US
dc.language.iso	en_US	en_US
dc.publisher	National Bureau of Economic Research	en_US
dc.relation.isversionof	http://www.nber.org/papers/w14769	en_US
dash.license	OAP
dc.subject	productivity	en_US
dc.subject	R&D	en_US
dc.subject	career concerns	en_US
dc.subject	institutional ownership	en_US
dc.subject	innovation	en_US
dc.title	Innovation and Institutional Ownership	en_US
dc.type	Journal Article	en_US
dc.description.version	Accepted Manuscript	en_US
dc.relation.journal	NBER Working Paper Series	en_US
dash.depositing.author	Aghion, Philippe
dc.date.available	2010-10-14T13:55:10Z

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  Peer reviewed scholarly articles from the Faculty of Arts and Sciences of Harvard University

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