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Accepted (AM)Open Access (License Unspecified), Open
Journal article
Seeking Alpha: Excess Risk Taking and Competition for Managerial Talent
The Review of financial studies, v 29(10), pp 2565-2599
01 Oct 2016
Abstract
We present a model in which firms compete for scarce managerial talent ("alpha") and managers are risk averse. When managers cannot move across firms after being hired, employers learn about their talent, efficiently allocate them to projects, and provide insurance to low-quality managers. When, instead, managers can move across firms, firm-level coinsurance is no longer feasible, but managers may self-insure by switching employer to delay the revelation of their true quality. However, this results in inefficient project assignment, with low-quality managers handling projects that are too risky for them. (JEL D62, G32, G38, J33)
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Details
- Title
- Seeking Alpha: Excess Risk Taking and Competition for Managerial Talent
- Creators
- Viral Acharya - New York UniversityMarco Pagano - University of Naples Federico IIPaolo Volpin - City, University of London
- Publication Details
- The Review of financial studies, v 29(10), pp 2565-2599
- Publisher
- Oxford Univ Press
- Number of pages
- 35
- Grant note
- 295709 / ERC (FINLAB project) Fondation Banque de France Europlace Institute of Finance, Inquire Europe BNP Paribas Hedge Fund Center (HEC Paris)
- Resource Type
- Journal article
- Language
- English
- Academic Unit
- Finance
- Web of Science ID
- WOS:000386207400001
- Scopus ID
- 2-s2.0-84992386043
- Other Identifier
- 991021862306804721
InCites Highlights
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- Collaboration types
- Domestic collaboration
- International collaboration
- Web of Science research areas
- Business, Finance
- Economics