Ownership, Visibility and Effort: Golf Handicaps as Proxies for Managers' Extra Effort

20 Pages Posted: 7 Apr 2015

See all articles by Constantin Schön

Constantin Schön

University of Zurich

Thomas Ehrmann

University of Muenster

Katja Rost

University of Zurich - Institute for Organization and Administrative Science

Date Written: May 2015

Abstract

Economics suggests that owners, CEOs and chairmen have different claims in a company's output, and thus that these groups exert different efforts. However, the effort an agent invests in his/her firm is difficult to measure. Golf handicaps enable us to look into the relationship between different degrees of ownership and their implications for the effort that agents exert. Handicaps have the advantage that they can be directly observed and can be viewed as a mirror image of a manager's effort. We expect that times of crisis and changes in management positions influence golf handicaps, mostly for owners and, to a lesser extent, for CEOs and chairmen. Data of 440 Swiss top managers and their handicaps during eight years, from 2003 to 2010, strongly support this assumption.

Suggested Citation

Schön, Constantin and Ehrmann, Thomas and Rost, Katja, Ownership, Visibility and Effort: Golf Handicaps as Proxies for Managers' Extra Effort (May 2015). Kyklos, Vol. 68, Issue 2, pp. 255-274, 2015, Available at SSRN: https://ssrn.com/abstract=2591161 or http://dx.doi.org/10.1111/kykl.12083

Constantin Schön (Contact Author)

University of Zurich ( email )

Rämistrasse 71
Zürich, CH-8006
Switzerland

Thomas Ehrmann

University of Muenster ( email )

Schlossplatz 2
D-48149 Muenster, D-48149
Germany

Katja Rost

University of Zurich - Institute for Organization and Administrative Science ( email )

Plattenstrasse 14
CH-8032 Zurich
Switzerland

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