New evidence on managerial labor markets: An analysis of CEO retreads

C. Edward Fee, Charles J. Hadlock, Joshua R. Pierce

Research output: Research - peer-reviewArticle

Abstract

We examine career outcomes of CEOs subsequent to turnover. CEOs often resurface after turnover, but they secure positions that are inferior to their prior posts. Success in the retread market is unrelated to prior employer performance and board composition. CEOs who were particularly attached to their prior employer tend to have the poorest subsequent job prospects. These results suggest a generally efficient CEO turnover process in which firms dismiss CEOs of low ability. As CEOs acquire specific human capital over time, their outside options and bargaining power appear to diminish, offering a potential explanation for the specialist CEO compensation discount.

LanguageEnglish (US)
Pages428-441
Number of pages14
JournalJournal of Corporate Finance
Volume48
DOIs
StatePublished - Feb 1 2018

Profile

Chief executive officer
Managerial labor markets
Employers
Turnover
Board composition
Outside options
Bargaining power
Career outcomes
Specific human capital
CEO compensation
CEO turnover
Discount

Keywords

  • CEO incentives
  • CEO turnover
  • External labor markets
  • Managerial ability
  • Retreads

ASJC Scopus subject areas

  • Business and International Management
  • Finance
  • Economics and Econometrics
  • Strategy and Management

Cite this

New evidence on managerial labor markets : An analysis of CEO retreads. / Fee, C. Edward; Hadlock, Charles J.; Pierce, Joshua R.

In: Journal of Corporate Finance, Vol. 48, 01.02.2018, p. 428-441.

Research output: Research - peer-reviewArticle

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