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| Author: | Hayes, R. M. Schaefer, S. |
| Title: | How much are differences in managerial ability worth ? |
| Journal: | Journal of Accounting & Economics
1999 : APR, VOL. 27:2, p. 125-148 |
| Index terms: | Managers Pay Labour markets Labour economics USA |
| Freeterms: | Managerial ability |
| Language: | eng |
| Abstract: | It the paper, it is identified manager / firm separations where managers quit for a new job. Studied are abnormal returns associated with these events. Applying analyses from labour economics, it is argued that the average ability of managers who resign for similar position at another firm should be higher than that of managers who die suddenly. Controlling for age and tenure, it is found in the paper that firms losing managers to other firms experience an average abnormal return of -1.51 %, compared to +3.82 % for firms whose managers die suddenly. The study uses differences in returns across groups to measure the value of differences in managerial ability. |
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