This paper reconciles two pronounced trends in U.S. corporate governance: the increase in pay levels for top executives, and the increasing prevalence of appointing CEOs through external hiring rather than internal promotions. We propose that these trends reflect a shift in the relative...

There is widespread concern about whether Chief Executive Officers (CEOs) are appropriately punished for poor performance. While CEOs are more likely to be forced out if their performance is poor relative to the industry average, overall industry performance also matters. This seems puzzling if...

We investigate whether outside board memberships of CEOs signal expertise or entrenchment. The analysis is based on panel data of the largest German companies covering the period from 1996 to 2008. Supporting the entrenchment hypothesis, our analysis reveals that firms having a CEO with one or...

We investigate whether outside board memberships of CEOs signal expertise or entrenchment. The analysis is based on panel data of the largest German companies covering the period from 1996 to 2008. Supporting the entrenchment hypothesis, our analysis reveals that firms having a CEO with one or...

This article is an idiosyncratic survey of the insider-outsider theory, describing the vision underlying the theory, and evaluating salient contributions to the literature in the light of this vision. We also indicate what appear to have been dead-ends and red herrings in past research. The...

This paper addresses the puzzle how employers that invest in general human capital can gain an information advantage with respect to the ability of their employees when training is certified by credible external institutions. We apply an established model from the employer-learning literature...

In the Netherlands auditors can be trained in a part-time educational track in which students combine working and studying or in a full-time educational track. The former training is relatively firm-specific whereas the latter training is relatively general. Applying human capital theory, we...

Though the shared investment hypothesis of human capital theory, i.e. that employers and employees share the costs of and the return on investment in firm-specific human capital, is widely accepted, we know little about the empirical evidence. The paper shows that in German data (1984-1991)...

Firm shutdown creates a turbulent situation for workers as it leads directly to layoffs for its workers. An additional consideration is whether a firm's shutdown within an industry creates turbulence for workers at other continuing firms. Using data drawn from the Longitudinal Worker File, a...

In the Netherlands auditors can be trained in a part-time educational track in which students combine working and studying or in a full-time educational track. The former training is relatively firm-specific whereas the latter training is relatively general. Applying human capital theory, we...