Abstract
Time Horizons in a Dual-Self Model of CEO Decision Making: Implications for Reducing Short-Termism
Academy of Management Annual Meeting Proceedings, Vol.2015(1), p.13156
01/2015
DOI: 10.5465/ambpp.2015.13156abstract
Abstract
Abstract only
Why do CEOs often choose strategies that achieve small, near-term payoffs for their firms instead of alternatives that would achieve much larger, but delayed, payoffs? And how might firms mitigate the likelihood of such economic short- termism by their CEOs? We take a step toward answering these questions by developing a dynamic, "dual-self" model of CEO strategic decision-making. Our model shows how self-control – i.e., delayed gratification for an inter-temporal strategic choice – is costly for a CEO due to both internal and external factors, and that the high cognitive loads of CEOs in dynamic industries increases this cost. Our model has important implications for boards of directors; specifically, trends in the types and timing of CEO compensation, the scope of the CEO’s job, and the average CEO tenure are increasing rather than decreasing the likelihood of short-termism.
Details
- Title: Subtitle
- Time Horizons in a Dual-Self Model of CEO Decision Making: Implications for Reducing Short-Termism
- Creators
- Guangliang Ye - Renmin University of ChinaRichard L. Priem - Texas Christian UniversityJie Zheng - Tsinghua SEMRyan Adam Krause - Texas Christian University
- Resource Type
- Abstract
- Publication Details
- Academy of Management Annual Meeting Proceedings, Vol.2015(1), p.13156
- DOI
- 10.5465/ambpp.2015.13156abstract
- eISSN
- 2151-6561
- Language
- English
- Date published
- 01/2015
- Academic Unit
- Management and Entrepreneurship
- Record Identifier
- 9984937788702771
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