Arbeitspapier
Managerial turnover in a changing world
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.
- Sprache
-
Englisch
- Erschienen in
-
Series: CSIO Working Paper ; No. 0105
- Klassifikation
-
Wirtschaft
Asymmetric and Private Information; Mechanism Design
- Thema
-
managerial turnover
termination clauses
dynamic mechanism design
adverse selection
moral hazard
- Ereignis
-
Geistige Schöpfung
- (wer)
-
Pavan, Alessandro
Garrett, Daniel
- Ereignis
-
Veröffentlichung
- (wer)
-
Northwestern University, Center for the Study of Industrial Organization (CSIO)
- (wo)
-
Evanston, IL
- (wann)
-
2010
- Handle
- Letzte Aktualisierung
-
20.09.2024, 08:21 MESZ
Datenpartner
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Objekttyp
- Arbeitspapier
Beteiligte
- Pavan, Alessandro
- Garrett, Daniel
- Northwestern University, Center for the Study of Industrial Organization (CSIO)
Entstanden
- 2010
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