Shaped by Booms and Busts: How the Economy Impacts CEO Careers and Management Styles
We show that economic conditions when CEOs enter the labor market have long-run effects on their career paths and managerial styles. Managers who begin their careers during recessions become CEOs more quickly, but at smaller firms. They also have more conservative styles, such as lower investment in capex and R&D, more cost cutting, and lower leverage and working capital needs. These recession effects appear to be largely driven by the characteristics of the CEO’s first job (recession CEOs tend to start in smaller or private firms), which suggests that the early work environment is important to the formation and selection of managers.
|Date of creation:||Nov 2011|
|Date of revision:|
|Contact details of provider:|| Postal: National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.|
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- Ulrike Malmendier & Stefan Nagel, 2009.
"Depression Babies: Do Macroeconomic Experiences Affect Risk-Taking?,"
NBER Working Papers
14813, National Bureau of Economic Research, Inc.
- Ulrike Malmendier & Stefan Nagel, 2011. "Depression Babies: Do Macroeconomic Experiences Affect Risk Taking?," The Quarterly Journal of Economics, Oxford University Press, vol. 126(1), pages 373-416.
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Annual Review of Financial Economics,
Annual Reviews, vol. 2(1), pages 75-102, December.
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- Kevin J. Murphy & Jan Zabojnik, 2006. "Managerial Capital and the Market for CEOs," Working Papers 1110, Queen's University, Department of Economics.
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