Abstract
ABSTRACT We investigate the impact of CEO’s happiness on firm innovation in China. As happiness is difficult to measure, we use CEO’s age based on the Happiness Curve theory. We find that when CEOs are in their less happy midlife stage, they more actively promote higher reward and risk innovation strategies, and that employee wellbeing represents a channel through which CEO unhappiness promotes innovation. The non-linear relationship between CEO age and risk-taking behaviour helps settle prior conflicting evidence which assumes a linear relationship.
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