Managerial Turnover in a Changing World
Bibliographic Data
| ID | 10184289 |
|---|---|
| Authors | Daniel F Garrett (Toulouse School of Economics), Alessandro Pavan (0000-0002-6577-8919, Northwestern University) |
| Year | 2012 |
| Volume | 120 |
| Issue | 5 |
| Pages | 879-925 |
| Publication date | 2012-10-01 |
| Open Access | No |
| Type | ARTICLE |
| Venue | Journal of Political Economy (JOURNAL) |
| Journal identifiers | ISSN: 0022-3808 • E-ISSN: 1537-534X |
| Publisher | University of Chicago Press (PUBLISHER • US) |
| DOI | 10.1086/668836 |
| OpenAlex | W2131350615 |
| Language | EN |
| References cited | 50 |
We characterize a firm's profit-maximizing turnover policy in an environment where managerial productivity changes stochastically over time and is the managers' private information. Our key positive result shows that the productivity level that the firm requires for retention declines with the managers' tenure in the firm. Our key normative result shows that, compared to what is efficient, the profit-maximizing policy either induces excessive retention (i.e., inefficiently low turnover) at all tenure levels, or excessive firing at the early stages of the relationship followed by excessive retention after sufficiently long tenure
Business · Economics · Key (lock · Labour economics · Macroeconomics · Management · Microeconomics · Normative · Productivity · Quality (philosophy · Turnover · Corporate Finance and Governance · Economic Policies and Impacts · Economic theories and models
| Highly cited | No |
|---|