全球智库信息集成服务系统(G2TT): CEO Investment Cycles

G2TT

来源类型	Working Paper
规范类型	报告
DOI	10.3386/w19330
来源ID	Working Paper 19330
	CEO Investment Cycles
	Yihui Pan; Tracy Yue Wang; Michael S. Weisbach
发表日期	2013-08-16
出版年	2013
语种	英语
摘要	This paper documents the existence of a CEO Investment Cycle, in which firms disinvest early in a CEO's tenure and increase investment subsequently, leading to "cyclical" firm growth in assets as well as in employment over CEO tenure. The CEO investment cycle occurs for both firings and non-performance related CEO turnovers, and for CEOs with different relationships with the firm prior to becoming CEO. The magnitude of the CEO cycle is substantial: The estimated difference in investment rate between the first three years of a CEO's tenure and subsequent years is approximately 6 to 8 percentage points, which is of the same order of magnitude as the differences caused by other factors known to affect investment, such as business cycles or financial constraints. We present a variety of tests suggesting that this investment cycle is best explained by a combination of agency-based theories: Early in his tenure the CEO disinvests poorly performing assets that his predecessor established and was unwilling to give up on. Subsequently, the CEO overinvests when he gains more control over his board. There is no evidence that the investment cycles occur because of shifting CEO skill or productivity shocks. Overall, the results imply that public corporations' investments deviate substantially from the first-best, and that governance-related factors internal to the firm are as important as economy-wide factors in explaining firms' investments.
主题	Financial Economics ; Corporate Finance ; Other ; Accounting, Marketing, and Personnel
URL	https://www.nber.org/papers/w19330
来源智库	National Bureau of Economic Research (United States)
引用统计
资源类型	智库出版物
条目标识符	http://119.78.100.153/handle/2XGU8XDN/577005
推荐引用方式 GB/T 7714	Yihui Pan,Tracy Yue Wang,Michael S. Weisbach. CEO Investment Cycles. 2013.