Are Executives in Short Supply? Evidence from Deaths' Events

56 Pages Posted: 26 Sep 2019 Last revised: 30 Nov 2022

See all articles by Julien Sauvagnat

Julien Sauvagnat

Bocconi University; Bocconi University - IGIER - Innocenzo Gasparini Institute for Economic Research

Fabiano Schivardi

Luiss Guido Carli - Department of Economics and Finance; Einaudi Institute for Economics and Finance (EIEF); Centre for Economic Policy Research (CEPR)

Multiple version iconThere are 2 versions of this paper

Date Written: September 14, 2019

Abstract

Using exhaustive administrative data on Italian social security records, we construct measures of local labor market thickness for executives that vary by industry and location. We show that firm performance is strongly and persistently affected by executive death, but only in thin local labor markets. The new executives hired after death events in thin local labor markets have lower education levels and are more likely to be replaced. These predictions are consistent with a simple model of executive search in which market thickness determines the arrival rate of applications for executive positions.

Keywords: Executives supply, firm performance, local growth

JEL Classification: J24, M51, R11

Suggested Citation

Sauvagnat, Julien and Schivardi, Fabiano, Are Executives in Short Supply? Evidence from Deaths' Events (September 14, 2019). Available at SSRN: https://ssrn.com/abstract=3453793 or http://dx.doi.org/10.2139/ssrn.3453793

Julien Sauvagnat (Contact Author)

Bocconi University ( email )

Via Sarfatti, 25
Milan, MI 20136
Italy

Bocconi University - IGIER - Innocenzo Gasparini Institute for Economic Research ( email )

Via Roentgen 1
Milan, 20136
Italy

Fabiano Schivardi

Luiss Guido Carli - Department of Economics and Finance ( email )

Viale Romania 32
Rome, Rome 00187
Italy

Einaudi Institute for Economics and Finance (EIEF) ( email )

Via Due Macelli, 73
Rome, 00187
Italy

Centre for Economic Policy Research (CEPR) ( email )

London
United Kingdom

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