ABSTRACT

We identify an unexplored attribute of the CEO associated with corporate investment efficiency – military experience. We hypothesize that military experienced CEOs tend to reduce agency conflicts, are less likely to be self-interested, and have a higher tendency to take value-enhancing projects which lead to higher investment efficiency. We test our core hypotheses using a sample of Pakistani firms from 2009 to 2017 and find that CEOs’ with military experience have a positive influence on investment efficiency. This positive effect is more pronounced in reducing underinvestment problems, in the presence of strong competition, and when CEO has higher incentives, but weaker for state-owned firms. These conclusions remain valid to alternative measures, after addressing endogeneity issues, and additional analyses. Overall, our research advances the literature by providing new evidence that CEO military experience can have a significant influence on corporate decisions.

摘要

我们确定了与企业投资效率相关的 CEO 的一个未被探索的属性——军事经验。我们假设军事经验丰富的 CEO 倾向于减少代理冲突，不太可能是自利的，并且更倾向于接受能够带来更高投资效率的增值项目。我们使用 2009 年至 2017 年的巴基斯坦公司样本检验了我们的核心假设，发现具有军事经验的 CEO 对投资效率有积极影响。这种积极作用在减少投资不足问题、存在激烈竞争以及 CEO 具有较高激励但对国有企业较弱的情况下更为明显。在解决了内生性问题和其他分析之后，这些结论对于替代措施仍然有效。全面的，