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ABSTRACT
According to different research paradigms, the impact of chair-CEO age dissimilarity on corporate decision-making may have a bright side or a dark side. This paper discusses the effect of chair-CEO age dissimilarity on investment efficiency in China. Using the sample of public firms from 2005 to 2019, we find an ‘ageing effect’ that a normative age gap between the chair and CEO improves firms’ investment efficiency by mitigating under-investment. Our finding deepens the understanding of the antecedent and the mechanism of investment efficiency from the micro-perspective of executives’ age differences.
Disclosure statement
No potential conflict of interest was reported by the author(s).
Notes
1 After the process of data winsorizing, all samples for this variable consist of cases where the chairman is at least 20 years older than the CEO, excluding instances where the CEO is at least 20 years older than the chairman (refer to Appendix B for detailed descriptive statistics). Therefore, the measurement of this variable aligns consistently with the normative age gap as defined in the paper.