Managerial flexibility, capacity investment, and inventory levels
利用美国各州分批采纳的选区法规作为准自然实验，研究发现该法规通过缓解管理层短视，使受影响的公司库存增加5.2%、产能投资增加15.4%，且对短视程度高的公司影响更强，最终也利于股东长期利益。
We study the effect of managerial time horizon on two key operations decisions: inventory levels and capacity investment. For identification, we exploit a quasi‐natural experiment provided by the staggered adoption of constituency statutes, which alleviate managerial short‐termism by providing legal protection to executives adopting a long‐term approach in their corporate decisions. Using a staggered difference‐in‐differences design, we find that, after the reforms, firms incorporated in constituency states (treated firms) increased inventory and capacity investment by 5.2% and 15.4%, respectively, relative to firms not incorporated in constituency states (control firms). We also find that these increases are gradual and persist over time, suggesting that they are structural in nature. We further show that the effect of constituency statutes on inventory levels and capacity investment are stronger for firms with ex ante higher level of managerial short‐termism, such as firms with low institutional ownership. Performance also increases relatively more for affected firms with higher ex ante managerial short‐termism. Our results pass a battery of robustness and validity tests. Interestingly, while constituency statutes are intended to protect executives from short‐term oriented shareholder sanctions, our findings suggest that these statutes ultimately benefited not only executives, but also potentially the long‐term interest of shareholders. Even in the absence of regulation, executives facing short‐term pressure could intensify communication efforts with shareholders on how specific operational decisions and investments would be beneficial to the company. Notably, executives could use various media channels to help shape retail investors’ attitude toward operational investments that may create future value.