Work

Firm-level political risk and intellectual capital investment: Does managerial ability matter?

Year: 2023

Type: article

Abstract: This paper examines the impacts of firm-level political risks on intellectual capital investment and how managerial ability adjusts this correlation. Using a broad sample of U.S firms from 2002 to 2021, our results show that firms with higher political risks reduce their investment in intellectual capital. This impact is more prominent for firms with high financial distress, external financial dependence, and lower institutional ownership. Further, we find supportive evidence that managerial ability helps prevents a considerable proportion (around 20%–40%) of the destructive impact of political risk on intellectual capital investment, which is also driven by firm-specific characteristics.

Source: International Review of Financial Analysis

DOI: 10.1016/j.irfa.2023.103020

Authors: Nhan Huynh, Quynh Nga Le, Quang Thien Tran

Institutions: Vietnam National University Ho Chi Minh City, Macquarie University, Monash University, Van Lang University

Language: English

Topic: Intellectual Capital and Performance Analysis

Subfield: Strategy and Management

Field: Business, Management and Accounting

Domain: Social Sciences

SDG: Peace, justice, and strong institutions

Open Access status: hybrid

Estimated APC paid: $3,150