Research Seminar, ReFi – Ryan Williams – University of Arizona – CEO Mobility, Performance-Turnover Sensitivity, and Compensation: Evidence from Non-Compete Contracts.
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University of Arizona
(cv & bio)
CEO Mobility, Performance-Turnover Sensitivity, and Compensation: Evidence from Non-Compete Contracts.
Meeting Ryan Williams
We are having Ryan Williams (University of Arizona) next Friday in our ReFi research seminar series (see here for more information).
Ryan will be available to meet with the faculty and PhD students during the afternon. If you are interested in meeting him, please send an email to Thomas David (firstname.lastname@example.org) indicating which of the following time slots suits you best:
14.30-15.00, 15.00-15.30, 15.30-16.00, 16.00-16.30, 16.30-17.00, 17.00-17.30
Non-compete agreements limit the mobility of employees, thereby imposing significant costs by reducing their outside options. In this paper, we focus on CEO non-compete agreements largely because CEOs have a better ability to negotiate their employment contracts than rank-and-file employees and their joining a competitor is likely to cause the greatest economic damage to the firm. Specifically, using hand collected data on CEO non-compete agreements, we examine: (i) the determinants of CEO non-compete agreements, (ii) the impact of CEO non-compete agreements on the CEO performance-turnover sensitivity, and (iii) how CEO non-compete agreements affect the level and structure of CEO compensation. We find evidence that is consistent with the argument that the presence of a non-compete agreement is the outcome of a bargaining game between the CEO and the firm. Consistent with the idea that non-compete agreements lower the likelihood that a departing CEO can create economic harm to the firm by joining a competitor, we find that the CEO performance-turnover sensitivity is significantly stronger when the CEO has a non-compete agreement in place. Finally, we find that CEO total compensation is higher if CEOs have non-compete contracts, but that the firm pays such compensation as incentive-based pay, consistent with the ex-post realization of the ex-ante bargaining game. We exploit staggered state-level changes in non-compete enforceability to establish causality. Our paper illustrates the impact of restrictions of CEO mobility on how CEOs are monitored and compensated by the firm.
79 avenue de la République 75011 Paris
Friday 15 December 2017
12:00am to 13:30pm, Room 4310
For security reason, please register before the deadline.
Deadline: 14 December 2017
NB. If you are prevented from coming, we would be obliged if you could inform us as soon as possible at email@example.com.