Managers as Knowledge Carriers - Explaining Firms' Internationalization Success with Manager Mobility

40 Pages Posted: 24 Aug 2018

See all articles by Philipp Meinen

Philipp Meinen

Deutsche Bundesbank

Pierpaolo Parrotta

Aarhus University - School of Business and Social Sciences

Davide Sala

University of Southern Denmark - Department of Business and Economics

Erdal Yalcin

University of Applied Sciences Konstanz; CESifo (Center for Economic Studies and Ifo Institute) - Ifo Institute

Date Written: June 28, 2018

Abstract

How does “what managers know” affect firm performance on international markets? This question is of considerable importance in the international economic literature. Answering it will be key for comprehending the way firms’ varying performance on international markets is shaped by the human factor. This paper proposes managerial mobility as an integral part of such an answer. Catering products to an international customer base entails a learning process, which, to a large degree, stems from the experience of doing it. Therefore, different employers immensely contend for managers’ highly valuable export experience. As managers can accept better and better positions from several offers, they may become highly mobile, thus having a notable impact on possibly multiple firms’ internationalization. Exploiting a rich panel data set, the paper thoroughly tests this idea by discriminating between knowledge ascribable to managers’ former job experience and that attributable to their personal background. The paper uses a novel identification strategy grounded in on-the-job search theory to correct estimates for the presence of self-selected mobility flows. A core finding of the paper is that the maximum return to expertise acquisition is realized for those managers with previous experience in commercializing differentiated products in specific markets.

Keywords: management, mobility, experience, export

JEL Classification: F140, F160, F230, M120

Suggested Citation

Meinen, Philipp and Parrotta, Pierpaolo and Sala, Davide and Yalcin, Erdal, Managers as Knowledge Carriers - Explaining Firms' Internationalization Success with Manager Mobility (June 28, 2018). CESifo Working Paper Series No. 7126, Available at SSRN: https://ssrn.com/abstract=3235231

Philipp Meinen

Deutsche Bundesbank ( email )

Wilhelm-Epstein-Str. 14
Frankfurt/Main, 60431
Germany

Pierpaolo Parrotta

Aarhus University - School of Business and Social Sciences ( email )

Nordre Ringgade 1
Aarhus C, DK-8000
Denmark

Davide Sala

University of Southern Denmark - Department of Business and Economics ( email )

DK-5230 Odense
Denmark

Erdal Yalcin (Contact Author)

University of Applied Sciences Konstanz ( email )

Alfred-Wachtel-Straße 8
Konstanz, 78462
Germany

CESifo (Center for Economic Studies and Ifo Institute) - Ifo Institute ( email )

Poschinger Str. 5
Munich, 01069
Germany

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