Corpus ID: 203589366

Executive Market Segmentation : How Local Density Affects Incentive and Performance

@inproceedings{Zhao2015ExecutiveMS,
  title={Executive Market Segmentation : How Local Density Affects Incentive and Performance},
  author={Hong Zhao and W. P. Carey},
  year={2015}
}
This paper studies how the density of executive labor markets affects managerial incentives and firm performance. I show that executive markets are locally segmented rather than nationally integrated, and the density of a local market provides executives with noncompensation incentives. In a denser market, executives face stronger performance-based dismissal threats as well as better outside promotion opportunities. These incentives induce executives to bring higher performance to firms in… Expand
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