Managerial ability, managerial risk taking and innovation performance

This study examines the effects of managerial risk-taking on corporate innovation performance. Using the sample of China's A-share listed companies from 2015 to 2020, we find strong evidence that managerial risk-taking has a positive effect on corporate innovation performance which relies on the managerial ability. Further, our results show that management personal risk-taking improves their ability and firm level risk-taking improves innovation performance only if it meets with high managerial ability. In this paper we provide new evidence that overly aggressive managerial personal risk tolerance may hinder managerial ability. In addition, we find that managerial ability and risk tolerance of enterprise may work together to promote corporate innovation performance.