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Deadlock on the Board / Jason Roderick Donaldson, Nadya Malenko, Giorgia Piacentino.
- Format:
- Book
- Author/Creator:
- Donaldson, Jason Roderick.
- Series:
- Working Paper Series (National Bureau of Economic Research) no. w26155.
- NBER working paper series no. w26155
- Language:
- English
- Physical Description:
- 1 online resource: illustrations (black and white);
- Place of Publication:
- Cambridge, Mass. National Bureau of Economic Research 2019.
- Summary:
- We develop a dynamic model of board decision-making. We show that a board could retain a policy all directors agree is worse than an available alternative. Thus, directors may retain a CEO they agree is bad--a deadlocked board leads to an entrenched CEO. We explore how to compose boards and appoint directors to mitigate deadlock. We find that board diversity and long director tenure can exacerbate deadlock. Moreover, we rationalize why CEOs and incumbent directors have power to appoint new directors: to avoid deadlock. Our model speaks to short-termism, staggered boards, and proxy access.
- Notes:
- Print version record
- August 2019.
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