CEO's age and the performance of closely held firms

0517849 - NHU-C 2020 RIV US eng J - Journal Article
Belenzon, S. - Shamshur, Anastasiya - Zarutskie, R.
CEO's age and the performance of closely held firms.
Strategic Management Journal. Roč. 40, č. 6 (2019), s. 917-944. ISSN 0143-2095. E-ISSN 1097-0266
Institutional support: Progres-Q24
Keywords : CEO's age * closely held firms * financial development
OECD category: Business and management
Impact factor: 5.463, year: 2019
Method of publishing: Limited access
http://dx.doi.org/10.1002/smj.3003

Using detailed ownership and financial information from a large sample of owner‐managed private firms in three Western European countries, this paper examines the relationship between CEO's age and firm's performance. Tracking firms over time, we find that as a CEO ages, the firm experiences lower investment, lower sales growth, and lower profitability, but also higher probability of survival, suggesting a trade‐off between the managerial approaches of younger and older CEOs. These results are stronger in industries more reliant on human capital, such as service and creative industries. Our evidence also suggests that regional financial development moderates the relationship between a CEO's age and a firm's performance by facilitating the reallocation of assets from firms owned by older CEOs to firms owned by younger CEOs.
Permanent Link: http://hdl.handle.net/11104/0303100