ABSTRACT
Using Chinese A-share listed manufacturing firms from 2008 to 2018, we examine the effect of CEOs’ military experience on firms’ cost stickiness. We find that firms with military CEOs have higher cost stickiness than those without military CEOs. The results are more pronounced for firms with high social responsibility (in SOEs and firms with better corporate social responsibility performance and higher labor intensity) and weak corporate governance (in firms with CEO duality, less independent directors, no director shareholding and no Big Four auditor). Our research extends the understanding of military CEOs’ influence on firms and sheds light on how CEOs’ characteristics affect cost stickiness.
Acknowledgment
We gratefully acknowledge helpful comments from the anonymous reviewer, Hong Hwang (associate editor), and Kam C. Chan.
Disclosure statement
No potential conflict of interest was reported by the author(s).
Notes
2. Untabulated tables show that results are robust when we measure firm size using the logarithm of total sales or market capitalization following Dang, Li, and Yang (Citation2018).
3. Untabulated results show that R&D costs are stickier in firms with military CEOs. We gratefully acknowledge for the editor’s suggestion.