How to interpret interaction effect when the relation it interacts with is negative instead of positive

Hi all!

I am struggling with an issue in writing my thesis: I am conducting a study about the effects of compensation on firms. One of the hypotheses (H2) argues that the amount of shares a manager possesses ex ante negatively moderates the (presumed) positive relationship of compensation on firms. However, this presumed positive relationship (H1), turns out to be a negative relationship in fact. H2 is indeed significantly negative in terms that it makes H1 more negative. Now my question is: Does this confirm my hypothesis 2 or not? Because technically it moderates it negatively, but it was based on the assumption that it would make the positive relation less positive, and not a negative relation more negative.

Thank you in advance for your help!


Less is more. Stay pure. Stay poor.
What evidence (literature) did you base your hypothesis on - was it founded? Your hypothesis was wrong, so it would reject it I guess, since the presented context was not well known. I wouldn't get all hung up on whether it rejected or provided evidence toward supporting it. I would just state that the directionality in the hypothesis was wrong and too specific, thus results moved in the inferred direction, but there was a different type of underlying relationship. This is why the tendency is to have two-sided hypotheses, so you don't get burned if the true data generating process is not known.
Yes it is based on previous research, but this previous research examined variables that were just different - but related enough to be able to make the hypotheses I made - . Anyways, thank you very much, it helped a lot! I will assimilate it in my thesis.