Innovation for survival: The scope of negative attainment discrepancy and enterprise R&D investment

The question of whether negative attainment discrepancy inhibits or promotes enterprises' investment in R&D remains unresolved. We argue that ignoring the diverse sources of negative attainment discrepancy and the longterm orientation of CEOs are two key reasons for the divergent findings of existing studies. Based on performance feedback theory and upper echelons theory, this study focuses on the effect of negative attainment discrepancy's scope on enterprises' R&D investment and how this effect may vary, depending on the CEO's long-term orientation. Using Chinese listed high-tech manufacturing enterprises (data taken from 2008 to 2020) as research samples, this study proposes and empirically demonstrates that negative attainment discrepancy scope motivates enterprises to actively increase R&D investment, especially when the enterprise is led by a CEO with long-term orientation (e.g., a CEO with a longer tenure or a technology background). Further analysis shows that the above conclusions only hold true for private-owned enterprises. Overall, this research provides evidence that negative attainment discrepancy scope is an important but unexplored antecedent of enterprises' R&D investment, thus providing more nuanced insight into the relationship between negative attainment discrepancy and corporate R&D decisions.