The Effect of Managerial Ability using DEA on Investment Efficiency

박수연,; Jung, Hyunwoo; Ko, Chang Youl

doi:10.17287/kbr.2016.20.4.255

Cited by 2 publications

(1 citation statement)

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“…Therefore, managerial ability was interpreted as an important factor in reducing risks due to business uncertainty and increasing creditworthiness. Park et al [80] observed that managerial ability also affects business investment decision-making and managerial ability has a positive effect on investment efficiency. Kang and Kim [81] set firm value as a long-term business performance measure and accounting earnings as a short-term performance measure, using them as dependent variables, and analyzed the relationship between the capabilities of the managers in the chaebol(a large family-owned business conglomerate) group and the long-term and short-term performance of the firm.…”

Section: Managerial Abilitymentioning

confidence: 99%

Effect of Managerial Compensation and Ability on the Relationship between Business Strategy and Firm Value: For Small and Medium-Sized Enterprises (SMEs)

Park

Byun

2022

Sustainability

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This study examines the effect of managerial ability and compensation on the relationship between business strategy and firm value for small and medium-sized enterprises (SMEs). Managers determine, plan, implement, and maintain a firm’s business strategy. Therefore, the characteristics of a manager are an important factor in the selection and success of a business strategy. We believe that managerial abilities are important factors in determining that success. If the managerial ability is good, the manager is more likely to implement a strategy suitable for the firm, significantly affecting the firm’s value. Managers are also more motivated to work harder if their compensation level is high. Therefore, the manager will make efforts to successfully lead the firm’s business strategy. In small and medium-sized enterprises (SMEs), the role of managers is important for carrying out strategies due to the lack of internal resources and difficulties in external funding. Therefore, we examine whether managerial ability and compensation affect the relationship between business strategy and firm value for SMEs. The analysis period is from 2011 to 2017, and the analysis was based on 1615 (firm/year), due to some of the listed SMEs being non-financial businesses with a December settlement of accounts. As a result of the analysis, managerial compensation and ability demonstrated different effects depending on the type of strategy, in terms of the relationship between business strategy and firm value. We suggest that managerial ability and compensation affect the value of a firm and moderate the relationship between business strategy and firm value.

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Section: Managerial Abilitymentioning

confidence: 99%

Effect of Managerial Compensation and Ability on the Relationship between Business Strategy and Firm Value: For Small and Medium-Sized Enterprises (SMEs)

Park

Byun

2022

Sustainability

View full text Add to dashboard Cite

show abstract

Do competent managers increase labor productivity? Evidence from Korea

Ahn

Yoo

Cho

2023

JDQS

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This study investigates the effect of managerial ability on labor productivity by analyzing various methods in the firm-year panel data of listed firms in South Korea from 2002 to 2019. Managerial ability was analyzed using the measurement method of Demerjian et al. (2012), while labor productivity was analyzed using value-added and sales. The authors find that managerial ability has a positive effect on labor productivity. In other words, the productivity of employees improves with the appointment of a manager with higher abilities. The study’s findings suggest that firms should consider managerial ability as a means of improving labor productivity.

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The Effect of Managerial Ability using DEA on Investment Efficiency

Cited by 2 publications

References 0 publications

Effect of Managerial Compensation and Ability on the Relationship between Business Strategy and Firm Value: For Small and Medium-Sized Enterprises (SMEs)

Effect of Managerial Compensation and Ability on the Relationship between Business Strategy and Firm Value: For Small and Medium-Sized Enterprises (SMEs)

Do competent managers increase labor productivity? Evidence from Korea

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