Does Top executive background have information content?An event study based on top executive turnover
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| Title | Does Top executive background have information content?An event study based on top executive turnover
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| Author | Jiang Fuxiu Huang Jicheng |
| Organization | School of Business, Renmin University of China |
| Email | jfx@ruc.edu.cn |
| Key Words | Top Executive Background; Information Content; Top Executive Turnover; Stock Price Reaction |
| Abstract | Using a sample of top executive appointments of China’s listed firms for the period from 2002 to 2009, this paper examines the information content of top executive background by testing the impact of background on turnover announcement effect and the difference of this impact in different development stage of capital market. We find that top executive background affects stock price reaction to turnover announcement. Specifically, we find evidence of a bell-shaped relationship between education degree and stock price reaction, and stock price reaction is better when the top executive is younger or from outside. Our results are robust to controlling the background of former executive. Further, we find this relationship depends on development stage of capital market, only in more mature stage after the split share structure reform. |
| Serial Number | WP321 |
| Time | 2012-08-29 |
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