Co-Worker Complementarity and the Stability of Top Management Teams
Stanford GSB Research Paper No. 1846
36 Pages Posted: 18 Mar 2004
Date Written: February 2004
We investigate the hypothesis that complementarities across co-workers (which may arise from matching or investments in specifc skills) affect the value of employment relationships between senior executives and firms. We analyze the changes in the composition of top management teams when a key member of the team (the CEO) departs. Our empirical analysis establishes several facts that are consistent with co-worker complementarity being an important determinant of management team stability.
Keywords: complementarity, economics of organizations, turnover
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