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Chief Executive Officer Inside Debt Holdings and Labor Investment Efficiency

Chief Executive Officer Inside Debt Holdings and Labor Investment Efficiency We show how chief executive officer (CEO) inside debt holdings affect corporations’ labor investment behavior. We empirically find a positive association between CEO inside debt holdings shown to increase their conservatism and long‐term horizons due to deferred payments and labor investment efficiency recognized as an integral factor in a firm's long‐term survival and growth. Additional analyses reveal that CEO inside debt holdings lead to a greater tendency to reduce net hiring amid excess labor availability than is observed when levels are optimal. This tendency is especially marked when CEO power is strong and when the firm has relatively high financial liquidity and leverage. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Asia-Pacific Journal of Financial Studies Wiley

Chief Executive Officer Inside Debt Holdings and Labor Investment Efficiency

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Publisher
Wiley
Copyright
Copyright © 2019 Korean Securities Association
ISSN
2041-9945
eISSN
2041-6156
DOI
10.1111/ajfs.12269
Publisher site
See Article on Publisher Site

Abstract

We show how chief executive officer (CEO) inside debt holdings affect corporations’ labor investment behavior. We empirically find a positive association between CEO inside debt holdings shown to increase their conservatism and long‐term horizons due to deferred payments and labor investment efficiency recognized as an integral factor in a firm's long‐term survival and growth. Additional analyses reveal that CEO inside debt holdings lead to a greater tendency to reduce net hiring amid excess labor availability than is observed when levels are optimal. This tendency is especially marked when CEO power is strong and when the firm has relatively high financial liquidity and leverage.

Journal

Asia-Pacific Journal of Financial Studies – Wiley

Published: Aug 1, 2019

Keywords: ; ; ; ; ;

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