An Explanation of the Inverted-U Relationship between Profitability and Innovation

Result code in IS VaVaI
<a href="https://www.isvavai.cz/riv?ss=detail&h=RIV%2F00216224%3A14560%2F14%3A00077997" target="_blank" >RIV/00216224:14560/14:00077997 - isvavai.cz</a>
Result on the web
<a href="http://dx.doi.org/10.5817/CZ.MUNI.M210-7423-2014" target="_blank" >http://dx.doi.org/10.5817/CZ.MUNI.M210-7423-2014</a>
DOI - Digital Object Identifier
<a href="http://dx.doi.org/10.5817/CZ.MUNI.M210-7423-2014" target="_blank" >10.5817/CZ.MUNI.M210-7423-2014</a>

Result language
angličtina
Original language name
An Explanation of the Inverted-U Relationship between Profitability and Innovation
Original language description
In this book I introduce two models of innovation that explain the inverted-U relationship between profitability and innovation, and the findings of Aghion et al. (2005) and Hashmi (2005) related to the relationship between profitability and the dispersion of productivity in the industry. The basic model provides a simple and general explanation of the empirical findings. In the basic model firms choose R&D expenditures that maximize their expected profits under the assumption that R and D expenditures of firms might be constrained by the size of their profits. The prospect-theory model provides a more specific explanation of the empirical findings, which includes a behavioral model of managerial decision-making. Managers in the model choose R andD expenditures according to the preferences represented by the prospect-theory value function. For specific sets of parameter values, both models generate predictions that correspond to the empirical findings of Aghion et al. (2005) and H
Czech name
—
Czech description
—

Publication year
2014
Confidentiality
S - Úplné a pravdivé údaje o projektu nepodléhají ochraně podle zvláštních právních předpisů

Similar results(10)