Top Executive Appointments: Firm Size And Managerial Holdings

Abstract

This paper analyzes top executive appointments according to internal promotions and external hirings.  It is found that the market response is significantly positive for external hirings and is insignificant for internal hirings.  A logistic regression shows that smaller firms are more likely to hire from outside and as firm size increases, the frequency of outside hiring decreases.  Higher managerial shareholdings increase the probability of external hirings.