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Managers as Knowledge Carriers - Explaining Firms' Internationalization Success with Manager Mobility

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  • Philipp Meinen
  • Pierpaolo Parrotta
  • Davide Sala
  • Erdal Yalcin

Abstract

How does “what managers know” affect firm performance on international markets? This question is of considerable importance in the international economic literature. Answering it will be key for comprehending the way firms’ varying performance on international markets is shaped by the human factor. This paper proposes managerial mobility as an integral part of such an answer. Catering products to an international customer base entails a learning process, which, to a large degree, stems from the experience of doing it. Therefore, different employers immensely contend for managers’ highly valuable export experience. As managers can accept better and better positions from several offers, they may become highly mobile, thus having a notable impact on possibly multiple firms’ internationalization. Exploiting a rich panel data set, the paper thoroughly tests this idea by discriminating between knowledge ascribable to managers’ former job experience and that attributable to their personal background. The paper uses a novel identification strategy grounded in on-the-job search theory to correct estimates for the presence of self-selected mobility flows. A core finding of the paper is that the maximum return to expertise acquisition is realized for those managers with previous experience in commercializing differentiated products in specific markets.

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  • Philipp Meinen & Pierpaolo Parrotta & Davide Sala & Erdal Yalcin, 2018. "Managers as Knowledge Carriers - Explaining Firms' Internationalization Success with Manager Mobility," CESifo Working Paper Series 7126, CESifo.
    • Handle: RePEc:ces:ceswps:_7126
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    Cited by:

    1. Meinen, Philipp & Raff, Horst, 2018. "International trade and retail market performance and structure: Theory and empirical evidence," Journal of International Economics, Elsevier, vol. 115(C), pages 99-114.
    2. Miklós Koren & Álmos Telegdy, 2024. "Expatriate Managers: Effects on Firm Performance," CEU Working Papers 2024_1, Department of Economics, Central European University.
    3. Dimitrios Exadactylos & Massimo Riccaboni & Armando Rungi, 2019. "Talents from Abroad. Foreign Managers and Productivity in the United Kingdom," Working Papers 01/2019, IMT School for Advanced Studies Lucca, revised Dec 2019.
    4. Piotr Tarka & Elżbieta Jędrych, 2023. "Toward an exploratory framework of determinants of marketing research effectiveness in business organizations," Journal of Marketing Analytics, Palgrave Macmillan, vol. 11(3), pages 503-522, September.
    5. Exadaktylos, Dimitrios & Riccaboni, Massimo & Rungi, Armando, 2024. "Talents from abroad. Foreign managers and productivity in the United Kingdom," International Economics, Elsevier, vol. 177(C).
    6. Lark, Olga & Videnord, Josefin, 2023. "Do Exporters Import Gender Inequality?," Working Papers 2023:6, Lund University, Department of Economics.
    7. Carsten Eckel & Ina Charlotte Jäkel & Luca Macedoni & Raymond Riezman & Raymond G. Riezman, 2024. "Testing the Waters: How Firms Enter New Markets," CESifo Working Paper Series 11340, CESifo.

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    More about this item

    Keywords

    management; mobility; experience; export;
    All these keywords.

    JEL classification:

    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F16 - International Economics - - Trade - - - Trade and Labor Market Interactions
    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
    • M12 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Personnel Management; Executives; Executive Compensation

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