Regulatory Oversight and Managerial Ability

Hesarzadeh, R. (2020). Regulatory oversight and managerial ability. Eurasian Business Review, 10(4), 559–585. doi:10.1007/s40821-020-00150-0

Posted: 24 Apr 2020 Last revised: 4 Nov 2020

Date Written: April 1, 2020

Abstract

I examine whether regulatory oversight affects managerial ability. To measure regulatory oversight, I use comment letters from two Iranian regulatory agencies. Furthermore, to measure managerial ability, I employ managerial ability-score introduced by Demerjian et al. (Management Science 58(7):1229–1248, 2012). Using a difference-in-differences design with a propensity score matching approach, I reveal that the managerial ability of a firm is enhanced following the receipt of a comment letter by the firm. I further reveal that the managerial ability of a firm is enhanced following the receipt of a comment letter by the firm’s industry peers. Collectively, the findings highlight the internalities and externalities of regulatory oversight in the context of managerial ability.

Keywords: Regulatory oversight, Managerial ability, Spillover effect, Difference-in-differences design, Emerging capital market

JEL Classification: G32, M42, M48

Suggested Citation

Hesarzadeh, Reza, Regulatory Oversight and Managerial Ability (April 1, 2020). Hesarzadeh, R. (2020). Regulatory oversight and managerial ability. Eurasian Business Review, 10(4), 559–585. doi:10.1007/s40821-020-00150-0, Available at SSRN: https://ssrn.com/abstract=3531713

Reza Hesarzadeh (Contact Author)

Ferdowsi University of Mashhad ( email )

Mashhad, 9177948974
Iran

HOME PAGE: http://Hesarzadeh.profcms.um.ac.ir/

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