Does a CEO's cultural heritage affect performance under competitive pressure?
Abstract
We exploit variation in cultural heritage across CEOs who are the children or grandchildren of immigrants to demonstrate that the cultural origins of CEOs matter for corporate outcomes. Following shocks to industry competition, firms led by CEOs who are second- or third-generation immigrants are associated with a 6.2% higher profitability than the average firm. This effect weakens over successive immigrant generations and cannot be detected for top executives other than the CEO. Additional analysis attributes this effect to various cultural values that prevail in a CEO’s ancestral country of origin.
Citation
Nguyen , D D , Hagendorff , J & Eshraghi , A 2018 , ' Does a CEO's cultural heritage affect performance under competitive pressure? ' , Review of Financial Studies , vol. 31 , no. 1 , pp. 97-141 . https://doi.org/10.1093/rfs/hhx046
Publication
Review of Financial Studies
Status
Peer reviewed
ISSN
0893-9454Type
Journal article
Collections
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