TY - JOUR

T1 - PhD CEOs and firm performance

AU - Urquhart, Andrew

AU - Zhang, Hanxiong

PY - 2022

Y1 - 2022

N2 - This paper investigates the relationship between the education of a Chief Executive Officer (CEO) and firm performance and provides robust evidence that firms led by CEOs with PhDs outperform their peers. We find that CEOs with PhDs increase firm performance by 3.03% while CEOs with a PhD from a highly ranked university increase firm performance by 4.65%. Our results are robust to endogenous CEO selection, transition firms, alternative rankings, unobserved firm characteristics and the network of the CEO. We also show that the increase in firm performance is due to a tighter control of costs and superior cash flow management.

AB - This paper investigates the relationship between the education of a Chief Executive Officer (CEO) and firm performance and provides robust evidence that firms led by CEOs with PhDs outperform their peers. We find that CEOs with PhDs increase firm performance by 3.03% while CEOs with a PhD from a highly ranked university increase firm performance by 4.65%. Our results are robust to endogenous CEO selection, transition firms, alternative rankings, unobserved firm characteristics and the network of the CEO. We also show that the increase in firm performance is due to a tighter control of costs and superior cash flow management.

U2 - 10.1111/eufm.12316

DO - 10.1111/eufm.12316

M3 - Article

JO - European Financial Management

JF - European Financial Management

SN - 1354-7798

ER -