This paper discusses the matching between CEOs of different talent and firms of different size, by considering boards' costly monitoring of CEOs who have private information about firm output. By incorporating a costly state verification model into a matching model, we have a number of novel findings. First, positive assortative matching (PAM) breaks down as larger firms match with less talented CEOs when monitoring is sufficiently costly despite of complementarity in firms' production technology.
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- Partial requirement for: Ph.D., Arizona State University, 2015Note typethesis
- Includes bibliographical references (pages 37-39)Note typebibliography
- Field of study: Economics