Atawnah, Nader, Eshraghi, Arman ![]() Item availability restricted. |
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Abstract
Using a sample of U.S. firms over three decades, we examine whether the efficiency with which managers generate revenue has an impact on firm value. We find that managerial ability is positively related to firm value such that one standard deviation increase in ability is associated with a 5.7% increase in firm value relative to the mean level. Importantly, by exploiting exogenous CEO turnover, we establish causality between managerial ability and firm value. This relation is stronger in the presence of corporate governance mechanisms, such as institutional investors and financial analysts. We also document a reduction in value-destroying practices - such as earnings management - in firms with more efficient managers.
Item Type: | Article |
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Date Type: | Publication |
Status: | Published |
Schools: | Business (Including Economics) |
Subjects: | H Social Sciences > HG Finance |
Publisher: | Elsevier |
ISSN: | 0275-5319 |
Date of First Compliant Deposit: | 13 October 2023 |
Date of Acceptance: | 8 October 2023 |
Last Modified: | 07 Nov 2023 13:47 |
URI: | https://orca.cardiff.ac.uk/id/eprint/163056 |
Citation Data
Cited 4 times in Scopus. View in Scopus. Powered By Scopus® Data
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