A Behavioral Understanding of Investment Horizon and Firm Performance

References

• Abell DF (1993) Managing with Dual Strategies: Mastering the Present, Preempting the Future (Macmillan, New York).Google Scholar
• Association for Financial Professionals (AFP) (2011) Current trends in estimating and applying the cost of capital report of survey results. Survey report, Association for Financial Professionals, Bethesda, MD.Google Scholar
• Amit R, Schoemaker PJH (1993) Strategic assets and organizational rent. Strategic Management J. 14(1):33–46.Crossref, Google Scholar
• Baker MP, Wurgler J (2011) Behavioral corporate finance: An updated survey. Constantinides G, Harris M, Stulz R, eds. Handbook of the Economics of Finance, Vol. 2 (Elsevier, Oxford, UK),351–417.Crossref, Google Scholar
• Baysinger BD, Kosnik RD, Turk TA (1991) Effects of board and ownership structure on corporate R&D strategy. Acad. Management J. 34(1):205–214.Crossref, Google Scholar
• Bebchuk L, Stole LA (1993) Do short-term objectives lead to under- or overinvestment in long-term projects? J. Finance 48(2):719–729.Crossref, Google Scholar
• Benner MJ (2007) The incumbent discount: Stock market categories and response to radical technological change. Acad. Management Rev. 32(3):703–720.Crossref, Google Scholar
• Black BS, Gilson RJ (1999) Does venture capital require an active stock market? J. Appl. Corporate Finance 11(4):36–48.Crossref, Google Scholar
• Bower JL (1970) Planning within the firm. Amer. Econom. Rev. 60(2):186–194.Google Scholar
• Bower JL (1986) Managing the Resource Allocation Process (Harvard Business School Press, Cambridge, MA).Google Scholar
• Brealey RA, Myers SC (1996) Principles of Corporate Finance, 5th ed. (McGraw-Hill, New York).Google Scholar
• Bromiley P (1986a) Corporate Capital Investment: A Behavioural Approach (Cambridge University Press, Cambridge, UK).Google Scholar
• Bromiley P (1986b) Corporate planning and capital investment. J. Econom. Behav. Organ. 7(2):147–170.Crossref, Google Scholar
• Bromiley P, Rau D (2014) Towards a practice-based view of strategy. Strategic Management J. 35(8):1249–1256.Crossref, Google Scholar
• Brown PB (2007) Shortsighted management. New York Times (November 24), C5.Google Scholar
• Bruner RF, Eades KM, Harris RS, Higgins RC (1998) Best practices in estimating the cost of capital: Survey and synthesis. Financial Practice Education 8(1):13–38.Google Scholar
• Bushee BJ (1998) The influence of institutional investors on myopic R&D investment behavior. Accounting Rev. 73(3):305–333.Crossref, Google Scholar
• Bushee BJ (2004) Identifying and attracting the “right” investors: Evidence on the behavior of institutional investors. J. Appl. Corporate Finance 16(4):28–35.Crossref, Google Scholar
• Chrisman JJ, Patel PC (2012) Variations in R&D investments of family and nonfamily firms: Behavioral agency and myopic loss aversion perspectives. Acad. Management J. 55(4):976–997.Crossref, Google Scholar
• Chrisman JJ, Chua JH, Pearson AW, Barnett T (2012) Family involvement, family influence, and family-centered non-economic goals in small firms. Entrepreneurship Theory Practice 36(2):267–293.Crossref, Google Scholar
• Chua JH, Chrisman JJ, Bergiel EB (2009) An agency theoretic analysis of the professionalized family firm. Entrepreneurship Theory Practice 33(2):355–372.Crossref, Google Scholar
• Cohen WD (2009) House of Cards: A Tale of Hubris and Wretched Excess on Wall Street (Doubleday, New York).Google Scholar
• Cool K, Schendel D (1987) Strategic group formation and performance: The case of the U.S. pharmaceutical industry, 1963–1982. Management Sci. 33(9):1102–1124.Link, Google Scholar
• Crosby PB (1979) Quality is Free: The Art of Making Quality Certain (McGraw-Hill, New York).Google Scholar
• Cyert RM, March JG (1963) A Behavioral Theory of the Firm, 2nd ed. (Blackwell Publishers, Malden, MA).Google Scholar
• Das TK (1987) Strategic planning and individual temporal orientation. Strategic Management J. 8(2):203–209.Crossref, Google Scholar
• Dasgupta P, Maskin E (2005) Uncertainty and hyperbolic discounting. Amer. Econom. Rev. 95(4):1290–1299.Crossref, Google Scholar
• Devers C, McNamara G, Wiseman RM, Aarfelt M (2008) Moving closer to the action: Examining compensation design effects on firm risk. Organ. Sci. 19(4):548–566.Link, Google Scholar
• Drucker PF (1993) Post-Capitalist Society (HarperCollins, New York).Google Scholar
• Eccles RG, Ioannou I, Serafeim G (2014) The impact of corporate sustainability on organizational processes and performance. Management Sci. 60(11):2835–2857.Link, Google Scholar
• Eisner R (1978) Factors in Business Investment (Ballinger, Cambridge, MA).Google Scholar
• Ferson WE, Locke DH (1998) Estimating the cost of capital through time: An analysis of the sources of error. Management Sci. 44(4):485–500.Link, Google Scholar
• Gately D (1980) Individual discount rates and the purchase and utilization of energy-using durables: Comment. Bell J. Econom. 11(1):373–374.Crossref, Google Scholar
• Graham JR, Harvey CR (2001) The theory and practice of corporate finance: Evidence from the field. J. Financial Econom. 60(2):187–243.Crossref, Google Scholar
• Graham JR, Harvey CR, Huang H (2009) Investor competence, trading frequency, and home bias. Management Sci. 55(7):1094–1106.Link, Google Scholar
• Graham JR, Harvey CR, Rajgopal S (2005) The economic implications of corporate financial reporting. J. Accounting Econom. 40(1):3–73.Crossref, Google Scholar
• Graham JR, Harvey CR, Rajgopal S (2006) Value destruction and financial reporting decisions. Financial Analysts J. 62(6):27–39.Crossref, Google Scholar
• Hausman J (1979) Individual discount rates and the purchase and utilization of energy-using durables. Bell J. Econom. 10(1):33–54.Crossref, Google Scholar
• Hayes RH, Abernathy WJ (1980) Managing our way to economic decline. Harvard Bus. Rev. 58(4):67–77.Google Scholar
• Henderson R (1993) Underinvestment and incompetence as responses to radical innovation: Evidence from the photolithographic alignment equipment industry. RAND J. Econom. 24(2):248–270.Crossref, Google Scholar
• Hoskisson RE, Hitt MA, Hill CWL (1993) Managerial incentives and investment in R&D in large multiproduct firms. Organ. Sci. 4(2):325–341.Link, Google Scholar
• Hunt M (1972) Competition in the major home appliance industry, 1960–1970. PhD dissertation, Harvard University, Cambridge, MA.Google Scholar
• Jacobs MT (1991) Short-Term America: The Causes and Cures of Our Business Myopia (Harvard Business School Press, Boston).Google Scholar
• Jacobson R, Aaker D (1993) Myopic management behavior with efficient, but imperfect, capital markets. J. Accounting Econom. 16(1-3):383–405.Crossref, Google Scholar
• Jagannathan R, Matsa DA, Meier I, Tarhan V (2016) Why do firms use high discount rates? J. Financial Econom. 120(3):445–463.Crossref, Google Scholar
• Jensen MC, Murphy KJ (1990) CEO incentives—It’s not how much you pay, but how. Harvard Bus. Rev. 68(3):138–149.Google Scholar
• Kahneman D, Slovic P, Tversky A (1982) Judgment Under Uncertainty: Heuristics and Biases (Cambridge University Press, Cambridge, UK).Crossref, Google Scholar
• Keating AS, Zimmerman JL (1999) Depreciation-policy changes: Tax, earnings management, and investment opportunity incentives. J. Accounting Econom. 28(3):359–389.Crossref, Google Scholar
• Kim C, Bettis RA (2014) Cash is surprisingly valuable as a strategic asset. Strategic Management J. 35(13):2053–2063.Crossref, Google Scholar
• Kogut B, Zander U (1992) Knowledge of the firm, combinative capabilities, and the replication of technology. Organ. Sci. 3(3):383–397.Link, Google Scholar
• Laibson DI (1997) Golden eggs and hyperbolic discounting. Quart. J. Econom. 112(2):443–477.Crossref, Google Scholar
• Laverty KJ (1996) Economic “short-termism”: The debate, the unresolved issues, and the implications for management practice and research. Acad. Management Rev. 21(3):825–860.Crossref, Google Scholar
• Lepak DP, Snell SA (1999) The human resource architecture: Toward a theory of human capital allocation and development. Acad. Management Rev. 24(1):31–48.Crossref, Google Scholar
• Loewenstein G, Prelec D (1992) Anomalies in intertemporal choice: Evidence and an interpretation. Quart. J. Econom. 107(2):573–597.Crossref, Google Scholar
• Lorsch JW, MacIver E (1989) Pawns or Potentates: The Reality of America’s Corporate Boards (Harvard Business School Press, Boston).Google Scholar
• Lumpkin GT, Brigham KH (2011) Long-term orientation and intertemporal choice in family firms. Entrepreneurship Theory Practice 35(6):1149–1169.Crossref, Google Scholar
• Mansfield E (1968) The Economics of Technological Change (W.W. Norton & Company, New York).Google Scholar
• March JG, Olsen JP (1975) The uncertainty of the past: Organizational learning under ambiguity. Eur. J. Political Res. 3(2):147–171.Crossref, Google Scholar
• March JG, Simon HA (1958) Organizations, 2nd ed. (Blackwell Publishers, Cambridge, MA).Google Scholar
• Marginson D, McAulay L (2008) Exploring the debate on short-termism: A theoretical and empirical analysis. Strategic Management J. 29(3):273–292.Crossref, Google Scholar
• Miller KD (2002) Knowledge inventories and managerial myopia. Strategic Management J. 23(8):689–706.Crossref, Google Scholar
• Munari F, Oriani R, Sobrero M (2010) The effects of owner identity and external governance systems on R&D investments: A study of Western European firms. Res. Policy 39(8):1093–1104.Crossref, Google Scholar
• Narayanan MP (1985) Managerial incentives for short-term results. J. Finance 40(5):1469–1484.Crossref, Google Scholar
• Pierce JR, Aguinis H (2013) The too-much-of-a-good-thing effect in management. J. Management 39(2):313–338.Crossref, Google Scholar
• Polk C, Sapienza P (2009) The stock market and corporate investment: A test of catering theory. Rev. Financial Stud. 22(1):187–217.Crossref, Google Scholar
• Porter ME (1980) Competitive Strategy: Techniques for Analyzing Industries and Competitors (Free Press, New York).Google Scholar
• Porter ME (1992) Capital disadvantage: America’s failing capital system. Harvard Bus. Rev. 70(5):65–82.Google Scholar
• Poterba JM, Summers L (1995) A CEO survey of U.S. companies’ time horizons and hurdle rates. Sloan Management Rev. 37(1):43–53.Google Scholar
• Prahalad CK, Bettis RA (1986) The dominant logic: A new linkage between diversity and performance. Strategic Management J. 7(6):485–501.Crossref, Google Scholar
• Quirin GD, Wiginton JC (1981) Analyzing Capital Expenditures: Private and Public Perspectives (Richard D. Irwin, Homewood, IL) Google Scholar
• Rumelt RP, Schendel D, Teece DJ (1991) Strategic management and economics. Strategic Management J. 12(52):5–29.Crossref, Google Scholar
• Samuelson J, Preisser C (2006) HBR List: Breakthrough ideas for 2006. Harvard Bus. Rev. 84(2):62–64.Google Scholar
• Sanders WG, Hambrick DC (2007) Swinging for the fences: The effects of CEO stock options on company risk taking and performance. Acad. Management J. 50(5):1055–1078.Crossref, Google Scholar
• Sirmon DG, Hitt MA (2003) Managing resources: Linking unique resources, management, and wealth creation in family firms. Entrepreneurship Theory Practice 27(4):339–358.Crossref, Google Scholar
• Souder D, Bromiley P (2012) Explaining temporal orientation: Evidence from the durability of firms’ capital investments. Strategic Management J. 33(5):550–569.Crossref, Google Scholar
• Souder D, Shaver JM (2010) Constraints and incentives for making long horizon corporate investments. Strategic Management J. 31(12):1316–1336.Crossref, Google Scholar
• Srinivasan R, Brush TH (2006) Supplier performance in vertical alliances: The effects of self-enforcing agreements and enforceable contracts. Organ. Sci. 17(4):436–452.Link, Google Scholar
• Stein JC (1988) Takeover threats and managerial myopia. J. Political Econom. 96(1):61–80.Crossref, Google Scholar
• Stein JC (1989) Efficient capital markets, inefficient firms: A model of myopic corporate behavior. Quart. J. Econom. 104(4):655–669.Crossref, Google Scholar
• Tesler LG (1968) Some aspects of the economics of advertising. J. Bus. 41(2):166–173.Crossref, Google Scholar
• Thakor AV (1990) Investment “myopia” and the internal organization of capital allocation decisions. J. Law, Econom., Organ. 6(1):129–154.Google Scholar
• Thaler RH (1981) Some empirical evidence on dynamic inconsistency. Econom. Lett. 8(3):201–207.Crossref, Google Scholar
• Thanassoulis JE, Somekh B (2015) Real economy effects of short-term equity ownership. J. Internat. Bus. Stud. 47(2):233–254.Crossref, Google Scholar
• Wang T, Bansal P (2012) Social responsibility in new ventures: Profiting from a long-term orientation. Strategic Management J. 33(10):1135–1153.Crossref, Google Scholar
• Welch JaS (2005) Winning (HarperBusiness, New York).Google Scholar
• Whelan K (2002) Computers, obsolescence, and productivity. Rev. Econom. Statist. 84(3):445–461.Crossref, Google Scholar
• Williamson OE (1985) The Economic Institutions of Capitalism (Free Press, New York).Google Scholar
• Wiseman RM (2009) On the use and misuse of ratios in strategic management research. Res. Methodology Strategy Management 5(1):75–110.Crossref, Google Scholar
• Zaheer S, Albert S, Zaheer A (1999) Time scales and organizational theory. Acad. Management Rev. 24(4):725–741.Crossref, Google Scholar
• Zahra SA (1996) Governance, ownership, and corporate entrepreneurship: The moderating impact of industry technological opportunities. Acad. Management J. 39(6):1713–1735.Crossref, Google Scholar
• Zhang Y, Gimeno J (2010) Earnings pressure and competitive behavior: Evidence from the U.S. electricity industry. Acad. Management J. 53(4):743–768.Crossref, Google Scholar
• Zhang Y, Gimeno J (2016) Earnings pressure and long-term corporate governance: Can long-term-oriented investors and managers reduce the quarterly earnings obsession? Organ. Sci. 27(2):354–372.Link, Google Scholar