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The Influence of CEO's Characteristics on Innovation Policy in Family Firms
The current research analyzes the influence of CEO characteristics on innovative policy in family companies. The innovation process in family and non-family firms varies in terms of strategies and R&D intensity and CEO characteristics may be reasons for such difference. For the study, the database of more than 1400 European public financial companies for 2010-2013 years was collected and two econometric models by means of panel data were built. The first model was built in order to determine the significance of ownership type (if a company is a family), and whether R&D spending is higher or lower in family firms than in non-family counterparts. The second one was connected solely with family firms and allowed to define a set of characteristics that influence CEO decision-making process with regard to innovative policy. Estimated regression models allowed to find out that innovation costs in family firms are higher than in non-family ones. Therefore, the second step was related to the attempt to explain this result by CEO specific traits. In addition, such characteristics as CEO master degree, The Chief’s risk-taking, CEO duality and CEO change have an impact on CEO decision-making process in family firms.