Does age similarity between board chair and CEO matter for R&D investments? Evidence from China

Psychology literature suggests that the similarity in age between individuals can influence their communication style, interactions, and information exchange. Given that the relationship between board chairperson (Chair) and Chief Executive Officer (CEO) involves extensive interactions and information-sharing with the aim to maintain shareholders' interests, this study seeks an answer as to whether age similarity between Chair and CEO affects R&D investment. Using data from A-share Chinese companies, we find that a similarity in age between the Chair and CEO had a negative impact on R&D intensity. Beyond its valuable contribution to the literature, the finding of this study is significant and relevant for practical applications, as it highlights the importance of considering the age gap between the Chair and CEO for companies looking to enhance corporate governance and maintain innovation.