Innovation and idiosyncratic risk: an industry- and firm-level analysis

Mazzucato, Mariana and Tancioni, Massimiliano (2008). Innovation and idiosyncratic risk: an industry- and firm-level analysis. Industrial and Corporate Change, 17(4)

DOI: https://doi.org/10.1093/icc/dtn024

URL: http://icc.oxfordjournals.org/cgi/content/abstract...

Abstract

Recent studies find that idiosyncratic risk (IR)�the degree to which firm-specific returns are more volatile than aggregate market returns–has increased since the 1960s and attribute this to economy-wide factors such as the role of the IT revolution. Yet no innovation data is used in these studies. To gain further insights into the relationship between technology and IR, our aricle studies whether firms and industries that are more R&D intensive are in fact characterized by higher IR due to how innovation affects the uncertainty of expected future profits. While the industry-level results prove inconclusive, a clear relationship is found between firm-level R&D intensity and firm-level volatility of returns.

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About

• Item ORO ID
• 11027
• Item Type
• Journal Item
• ISSN
• 1464-3650
• Keywords
• Idiosyncratic Risk; Volatility; Technological Change; Industry Life Cycle;
• Academic Unit or School
• Faculty of Arts and Social Sciences (FASS)
• Research Group
• Institute for Innovation Generation in the Life Sciences (Innogen)
• Depositing User
• Users 9 not found.