TY - JOUR
T1 - Hiring Lucky CEOs
AU - Amore, Mario Daniele
AU - Schwenen, Sebastian
N1 - Publisher Copyright:
© The Author(s) 2022. Published by Oxford University Press on behalf of Yale University. All rights reserved.
PY - 2024/11/1
Y1 - 2024/11/1
N2 - Existing research shows that luck increases CEOs’ pay at their current firm. In this work, we explore how luck affects: (1) CEOs’ employment opportunities and (2) the performance of firms that hire lucky CEOs. Our results indicate that luck increases the likelihood to get a CEO job at new companies. Conditional on moving, lucky CEOs obtain a higher pay (both in absolute terms and relative to new industry peers) mostly due to higher incentive pay. Moreover, lucky CEOs tend to be hired by firms operating in less competitive industries. Despite the higher compensation they receive, the appointment of lucky CEOs is associated with a substantial decline in firm performance. (JEL: G34, D86, J33, M12).
AB - Existing research shows that luck increases CEOs’ pay at their current firm. In this work, we explore how luck affects: (1) CEOs’ employment opportunities and (2) the performance of firms that hire lucky CEOs. Our results indicate that luck increases the likelihood to get a CEO job at new companies. Conditional on moving, lucky CEOs obtain a higher pay (both in absolute terms and relative to new industry peers) mostly due to higher incentive pay. Moreover, lucky CEOs tend to be hired by firms operating in less competitive industries. Despite the higher compensation they receive, the appointment of lucky CEOs is associated with a substantial decline in firm performance. (JEL: G34, D86, J33, M12).
UR - http://www.scopus.com/inward/record.url?scp=85209630457&partnerID=8YFLogxK
U2 - 10.1093/jleo/ewac021
DO - 10.1093/jleo/ewac021
M3 - Article
AN - SCOPUS:85209630457
SN - 8756-6222
VL - 40
SP - 571
EP - 596
JO - Journal of Law, Economics, and Organization
JF - Journal of Law, Economics, and Organization
IS - 3
ER -