Historical Government Regulations and Firms’ Innovation Input

I argue that founding and initial public offering (IPO) are sensitive periods when organizations imprinted by their environment. Stronger government interventions during these sensitive periods imprint firms with a more diversified research and development (R&D) structure and a focus that downplays competition and highlights government intervention, which in turn discourage R&D investment. Moreover, the subsequent sensitive period, IPO, modifies imprinting effects formed during founding. Further, founding is a stronger sensitive period than IPO regarding the magnitude of imprinting effect. I test the regulatory imprinting of (1) U.S. firms based on industry and (2) worldwide firms based on location and find supportive evidence. My research contributes to imprinting theory by (1) showing potential mechanisms through which government interventions in history affect firms’ R&D and (2) articulating organizational sensitive periods in terms of imprinting dynamics and heterogeneity.