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Leadership: A Personnel Economics Approach


  • Edward P. Lazear


A theory of leadership is proposed and tested. Leaders are characterized as those who have the ability to choose the right direction more frequently than their peers. The theory implies that leaders tend to be more able, place themselves in visible decision making situations more frequently, and are generalists. Also, the most able leaders should be found in the highest variance industries, where decision making has the greatest payoff. The theory is tested using data on Stanford business school alumni and is confirmed. Leaders are generalists rather than specialists, both innately and in their pattern of skill acquisition.

Suggested Citation

  • Edward P. Lazear, 2010. "Leadership: A Personnel Economics Approach," NBER Working Papers 15918, National Bureau of Economic Research, Inc.
  • Handle: RePEc:nbr:nberwo:15918
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    References listed on IDEAS

    1. Baumol, William J., 1996. "Entrepreneurship: Productive, unproductive, and destructive," Journal of Business Venturing, Elsevier, vol. 11(1), pages 3-22, January.
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    Cited by:

    1. Dora L. Costa, 2014. "Leaders: Privilege, Sacrifice, Opportunity, and Personnel Economics in the American Civil War," Journal of Law, Economics, and Organization, Oxford University Press, vol. 30(3), pages 437-462.
    2. Kvaløy, Ola & Schöttner, Anja, 2015. "Incentives to motivate," Journal of Economic Behavior & Organization, Elsevier, vol. 116(C), pages 26-42.
    3. Alexander Ljungqvist & Konrad Raff, 2017. "Busy Directors: Strategic Interaction and Monitoring Synergies," NBER Working Papers 23889, National Bureau of Economic Research, Inc.
    4. Manoj Atolia & Yoshinori Kurokawa, 2014. "Entry Costs, Task Variety, and Skill Flexibility: A Simple Theory of (Top) Income Skewness," Tsukuba Economics Working Papers 2014-001, Economics, Graduate School of Humanities and Social Sciences, University of Tsukuba, revised Apr 2015.
    5. Kim, Jaesoo, 2012. "Endogenous leadership in incentive contracts," Journal of Economic Behavior & Organization, Elsevier, vol. 82(1), pages 256-266.

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    JEL classification:

    • J0 - Labor and Demographic Economics - - General


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