Abstract
We examine the effect of media coverage on firm innovation. Using a comprehensive sample of corporate news coverage and patenting over the period from 2000 to 2012, we find a negative relation between media coverage and firm innovation. We further document the two offsetting economic mechanisms underlying the impact of media coverage on innovation: the media’s role of short-term pressure on managers relates negatively to innovation, while its role of mitigating financial constraints is positively associated with innovation. Our findings provide new insights into the effect of news coverage on firms’ long-term growth.
| Original language | English |
|---|---|
| Pages (from-to) | 343-390 |
| Number of pages | 48 |
| Journal | Review of Accounting Studies |
| Volume | 26 |
| Issue number | 1 |
| Early online date | 18 Jul 2020 |
| DOIs | |
| Publication status | Published - Mar 2021 |
| Externally published | Yes |
Keywords
- Financial constraint
- Firm innovation
- Managerial myopia
- Media coverage