When Visibility Shapes Search: CEO Celebrity and Firms’ R&D Responses to Performance Feedback

This study examines how CEO celebrity moderates firms’ R&D responses to performance feedback. According to the Behavioral Theory of the Firm (BTOF), firms adjust their search behavior based on whether performance falls below or exceeds aspiration levels. R&D investment, which is uncertain but central to long-term innovation, is a core domain in which such performance-driven adjustments occur. Although prior research has identified various organizational contingencies shaping this relationship, comparatively little attention has been paid to the social standing of CEOs. We argue that CEO celebrity—sustained public visibility and symbolic prominence—constitutes a social-evaluative mechanism that alters how performance feedback is interpreted, attended to, and translated into R&D decisions. Using panel data on 337 publicly listed U.S. manufacturing firms from 2015 to 2024 (2,266 firm-year observations), we estimate firm fixed-effects models of R&D intensity. The results reveal an asymmetry. Negative performance feedback has no significant effect on R&D, nor is it moderated by CEO celebrity. By contrast, positive performance feedback is negatively associated with R&D intensity, but this effect is significantly weaker when CEOs are highly visible. Firms led by celebrity CEOs maintain higher R&D investment when performance exceeds aspirations. These findings show that performance feedback operates through a socially embedded and identity-relevant lens, highlighting how executive visibility shapes organizational search.