CEO replacement under private information
- We study a model of “information-based entrenchment” in which the CEO has private information that the board needs to make an efficient replacement decision. Eliciting the CEO’s private information is costly, as it implies that the board must pay the CEO both higher severance pay and higher on-the-job pay. While higher CEO pay is associated with higher turnover in our model, there is too little turnover in equilibrium. Our model makes novel empirical predictions relating CEO turnover, severance pay, and on-the-job pay to firm-level attributes such as size, corporate governance, and the quality of the firm’s accounting system.
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| Verfasserangaben: | Roman InderstORCiDGND, Holger Müller |
|---|---|
| URN: | urn:nbn:de:hebis:30-72972 |
| URL: | http://www.imfs-frankfurt.de/fileadmin/user_upload/pdf/WP_2009_29_Inderst.pdf |
| Titel des übergeordneten Werkes (Deutsch): | Working paper series / Institute for Monetary and Financial Stability ; 29 |
| Schriftenreihe (Bandnummer): | Working paper series / Institute for Monetary and Financial Stability (29) |
| Dokumentart: | Arbeitspapier |
| Sprache: | Englisch |
| Jahr der Fertigstellung: | 2009 |
| Jahr der Erstveröffentlichung: | 2009 |
| Veröffentlichende Institution: | Universitätsbibliothek Johann Christian Senckenberg |
| Datum der Freischaltung: | 08.12.2009 |
| Bemerkung: | Published in: Review of Financial Studies, 2010, vol. 23, issue 8, pp. 2935-2969 |
| HeBIS-PPN: | 220431809 |
| Institute: | Wissenschaftliche Zentren und koordinierte Programme / Institute for Monetary and Financial Stability (IMFS) |
| DDC-Klassifikation: | 3 Sozialwissenschaften / 33 Wirtschaft / 330 Wirtschaft |
| Lizenz (Deutsch): |  Deutsches Urheberrecht |
