Impact of CEO Equity Incentives on Corporate Innovation and Boundary Conditions in Resource-Dependent Firms

DOI

10.2991/978-94-6239-604-3_38How to use a DOI?

Keywords

Equity Incentives; Enterprise Innovation Output; Patent Applications and Grants; Enterprise Resource Endowment; Poisson Regression

Abstract

This study empirically investigates the influence of Chief Executive Officer (CEO) equity incentives on corporate technological innovation and explores the boundary conditions of this relationship. Utilizing panel data from publicly listed companies in the United States spanning from 1980 to 2021, the research employs patent output as a quantitative measure of innovation performance and applies a Poisson regression model to examine the effects of varying levels of equity incentive ratios. By incorporating lagged variables, the analysis accounts for dynamic persistence in innovation activities, while the inclusion of interaction terms facilitates the examination of the moderating role of corporate resource endowments, thereby enhancing the robustness of causal inference. The empirical results indicate that a 10%-point increase in the intensity of equity incentives corresponds to an average increase of 3.65% in patent applications and 5.69% in patent grants, with these effects persisting for up to two years. Heterogeneity analysis reveals that the marginal effect of equity incentives diminishes markedly in firms characterized by larger scale and higher profitability. From a theoretical perspective, this research constructs a framework elucidating how compensation contracts influence innovation decision-making processes. Practically, the findings provide differentiated benchmarks for designing incentive schemes tailored to growth-stage and mature firms. The results offer valuable insights for firms seeking to develop dynamically aligned incentive strategies and for regulators aiming to enhance the oversight of innovation quality.

Copyright

© 2026 The Author(s)

Open Access

Open Access This chapter is licensed under the terms of the Creative Commons Attribution-NonCommercial 4.0 International License (http://creativecommons.org/licenses/by-nc/4.0/), which permits any noncommercial use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons license and indicate if changes were made.

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TY  - CONF
AU  - Yichao Qiu
PY  - 2026
DA  - 2026/02/26
TI  - Impact of CEO Equity Incentives on Corporate Innovation and Boundary Conditions in Resource-Dependent Firms
BT  - Proceedings of the 5th International Conference on Economic Development and Business Culture (ICEDBC 2025)
PB  - Atlantis Press
SP  - 367
EP  - 378
SN  - 2352-5428
UR  - https://doi.org/10.2991/978-94-6239-604-3_38
DO  - 10.2991/978-94-6239-604-3_38
ID  - Qiu2026
ER  -