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Chief Executive Officer Careers in Regulated Environments: Evidence from Electric and Gas Utilities


  • Hadlock, Charles J
  • Lee, D Scott
  • Parrino, Robert


We compare chief executive officers (CEOs) of electric and gas utility firms with CEOs of unregulated firms. Utility CEOs tend to be older when appointed to office, have less-prestigious educational backgrounds, and are more likely to have a legal background. Despite these differences, the evidence indicates that the likelihood of utility CEO turnover is at least as sensitive to stock performance as the likelihood of turnover among CEOs of unregulated firms. We find no convincing evidence that utility CEOs stay in office longer than their unregulated counterparts, although they are less likely to be overtly forced from office or replaced by an executive from outside the firm. Finally, the evidence suggests that regulatory expertise is valued in the selection of new utility CEOs. Copyright 2002 by the University of Chicago.

Suggested Citation

  • Hadlock, Charles J & Lee, D Scott & Parrino, Robert, 2002. "Chief Executive Officer Careers in Regulated Environments: Evidence from Electric and Gas Utilities," Journal of Law and Economics, University of Chicago Press, vol. 45(2), pages 535-563, October.
  • Handle: RePEc:ucp:jlawec:v:45:y:2002:i:2:p:535-63

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    References listed on IDEAS

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    9. Joskow, Paul L, 1974. "Inflation and Environmental Concern: Structural Change in the Process of Public Utility Price Regulation," Journal of Law and Economics, University of Chicago Press, vol. 17(2), pages 291-327, October.
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    Cited by:

    1. Hu, Fang & Leung, Sidney C.M., 2012. "Top management turnover, firm performance and government control: Evidence from China's listed state-owned enterprises," The International Journal of Accounting, Elsevier, vol. 47(2), pages 235-262.
    2. Bird, Robert C. & Borochin, Paul A. & Knopf, John D., 2015. "The role of the chief legal officer in corporate governance," Journal of Corporate Finance, Elsevier, vol. 34(C), pages 1-22.
    3. Powers, Eric A., 2005. "Interpreting logit regressions with interaction terms: an application to the management turnover literature," Journal of Corporate Finance, Elsevier, vol. 11(3), pages 504-522, June.
    4. Carlo Cambini & Sara De Masi & Laura Rondi, 2016. "CEO incentives in European energy utilities: evidence from regulated versus unregulated firms," Economia e Politica Industriale: Journal of Industrial and Business Economics, Springer;Associazione Amici di Economia e Politica Industriale, vol. 43(2), pages 127-155, June.

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