NET Institute Working Paper #08-21, 2008
This paper examines how manager and firm characteristics relate to entry decisions in U.S. local telephone markets.
Managers's skills have an extremely strong impact on firms' strategic survival.
- Older firms with older, more experienced managers have higher estimated levels of strategic ability.
- Managers with degrees in economics or business, and managers with graduate degrees, also have higher estimated levels of strategic ability.
- This paper finds no evidence that the quality of managers’ degrees, based on their universities, is related to ability.
- The estimates of strategic ability are also correlated with survival: those firms with lower estimated levels of ability are more likely to exit the industry early.