Year: 2021
Type: article
Abstract: This paper investigates the relationship between the education of a Chief Executive Officer (CEO) and firm performance and provides robust evidence that firms led by CEOs with PhDs outperform their peers. We find that CEOs with PhDs increase firm performance by 3.03% while CEOs with a PhD from a highly ranked university increase firm performance by 4.65%. Our results are robust to endogenous CEO selection, transition firms, alternative rankings, unobserved firm characteristics and the network of the CEO. We also show that the increase in firm performance is due to a tighter control of costs and superior cash flow management.
Source: European Financial Management
DOI: 10.1111/eufm.12316
Authors: Andrew Urquhart, Hanxiong Zhang
Institutions: ICMA Centre, University of Reading, University of Surrey
Language: English
Subfield: Accounting
Domain: Social Sciences
Open Access status: hybrid
Estimated APC paid: $2,800
OpenAlex ID: W3161237647