Paolo Volpin

Cass Business School
106 Bunhill Row

E-Mail: EmailAddress: hidden: you can email any NBER-related person as first underscore last at nber dot org
Institutional Affiliation: London Business School

NBER Working Papers and Publications

March 2013Seeking Alpha: Excess Risk Taking and Competition for Managerial Talent
with Viral V. Acharya, Marco Pagano: w18891
We present a model in which managers are risk-averse and firms compete for scarce managerial talent ("alpha"). When managers are not mobile across firms, firms provide efficient compensation, which allows for learning about managerial talent and for insurance of low-quality managers. When instead managers can move across firms, firms cannot offer co-insurance among employees. In anticipation, risk-averse managers may churn across firms or undertake aggregate risks in order to delay the revelation of their true quality. The result is excessive risk-taking with pay for short-term performance and an accumulation of long-term risks. We conclude with a discussion of policies to address the inefficiency in compensation.

Published: Viral Acharya & Marco Pagano & Paolo Volpin, 2016. "Seeking Alpha: Excess Risk Taking and Competition for Managerial Talent," Review of Financial Studies, Society for Financial Studies, vol. 29(10), pages 2565-2599. citation courtesy of

November 2005The History of Corporate Ownership in Italy
with Alexander Aganin
in A History of Corporate Governance around the World: Family Business Groups to Professional Managers, Randall K. Morck, editor
January 2000The Eclipse of the U.S. Tire Industry
with Raghuram Rajan, Luigi Zingales
in Mergers and Productivity, Steven N. Kaplan, editor

National Bureau of Economic Research
1050 Massachusetts Ave.
Cambridge, MA 02138

Twitter RSS

View Full Site: One timeAlways