TY  - UNPD
A1  - Ellul, Andrew
A1  - Pagano, Marco
A1  - Scognamiglio, Annalisa
T1  - Career risk and market discipline in asset management
T2  - Center for Financial Studies (Frankfurt am Main): CFS working paper series ; No. 602
N2  - We establish that the labor market helps discipline asset managers via the impact of fund liquidations on their careers. Using hand-collected data on 1,948 professionals, we find that top managers working for funds liquidated after persistently poor relative performance suffer demotion coupled with a significant loss in imputed compensation. Scarring effects are absent when liquidations are preceded by normal relative performance or involve mid-level employees. Seen through the lens of a model with moral hazard and adverse selection, these results can be ascribed to reputation loss rather than bad luck. The findings suggest that performance-induced liquidations supplement compensation-based incentives.
T3  - CFS working paper series - 602 
KW  - hedge funds
KW  - asset managers
KW  - market discipline
KW  - scarring effects
Y1  - 2018
UR  - http://publikationen.ub.uni-frankfurt.de/frontdoor/index/index/docId/47349
UR  - https://nbn-resolving.org/urn:nbn:de:hebis:30:3-473495
UR  - https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3274340
IS  - 30 July 2018
PB  - Center for Financial Studies
CY  - Frankfurt, M.
ER  -