CEOs as Jacks of All Trades, Do Executives with Multi-Industry Experience Help Firms Compete?
42 Pages Posted: 3 Sep 2021
Date Written: September 19, 2020
The rise of transferable managerial skills is one of the most well-documented but least understood trends in the CEO market. I explain this phenomenon by showing that growing competition in the product markets is a key factor driving the increased importance of CEOs' transferable managerial skills, specifically industry-transferable skills. To rule out the endogeneity of CEO-firm matching, my identification strategy combines within-firm variation in segment data and a quasi-natural experiment, the Canada-United States Free Trade Agreement of 1989 (FTA). I show that CEOs with these skills outperform in competitive markets and are a good match for firms' innovation-based competition strategy.
Keywords: Product market competition, General human capital, Innovation, R&D.
JEL Classification: G30, J24, M12, O31
Suggested Citation: Suggested Citation