Does Replacing a Manager Improve Performance?
41 Pages Posted: 28 May 2020
Date Written: 2017
This paper investigates whether replacing a coach improves teams performance. We do so by using match-level team performance data and a propensity score matching triple diﬀerence estimator. As a control group we use the matches of teams that did not ﬁre the coach but that share similar observable characteristics and an identical pre-ﬁring performance history with those whose coach was ﬁred. On average, teams perform better with the new coach: they win more games, score more goals and concede fewer. How- ever, all these positive eﬀects disappear when one compares the improvement in performance of those teams whose coach was ﬁred with the corresponding “improvement” achieved by control teams that have a similar probability of ﬁring the coach but have not done so. Our results do suggest that ﬁring is likely to be an instrument used to provide incentives. Soccer teams may use it more often than ﬁrms simply because the outcome is easily observed.
Keywords: propensity score matching, dif-dif manager performance
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