Managerial Cognition and Slack Resources: Exploration and Exploitation in Research

Abstract

We focus on the managerial implications of the introduction of a fiscal scheme for advance payment partial exemption in favor of highly qualified researchers in business enterprises in Belgium. The amount deliberated by the exemption can be freely used by the company. The paper adds to the literature on managerial cognition by highlighting that strategic choices related to available R&D slack resources depend on differences in how the financial slack provided by the tax credit measure is represented to internal management; i.e. made visible as an R&D revenue, as an R&D labor wage cost reduction, or no visible registration of R&D related revenues or cost reduction.