44 Pages Posted: 15 Sep 2008 Last revised: 7 Sep 2010
Date Written: September 2008
What makes a good leader? A good leader is able to coordinate his followers around a credible mission statement, which communicates the future course of action of the organization. In practice, leaders learn about the best course of action for the organization over time. While learning helps improve the organization's goals it also creates a time-consistency problem. Leader resoluteness is a valuable attribute in such a setting, since it slows down the leader's learning and thus improves the credibility of the mission statement. But resolute leaders also inhibit communication with followers and leader resoluteness is costly when followers have sufficiently valuable signals.
Suggested Citation: Suggested Citation
Bolton, Patrick and Brunnermeier, Markus K. and Veldkamp, Laura, Leadership, Coordination and Mission-Driven Management (September 2008). NBER Working Paper No. w14339. Available at SSRN: https://ssrn.com/abstract=1267570