Managerial connections and corporate risk-taking: evidence from the Great Recession

N. K. Chidambaran and Stefano Manfredonia

Journal of Credit Risk

Abstract: In this paper we analyze the relationship between managers’ connections, corporate risk-taking and corporate performance during a period of crisis. Using the Great Recession of 2007–9 as a laboratory experiment, we show that corporate equity volatility increased substantially for firms operating in sectors severely affected by this crisis. We also show that this effect was greater for firms with well-connected managers and that these firms adopted riskier corporate policies. However, further results suggest that managers’ connections also helped firms to recover to their precrisis levels of performance faster.

References: Add references at CitEc
Citations:

Downloads: (external link)
https://www.risk.net/journal-of-credit-risk/795627 ... -the-great-recession (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:rsk:journ1:7956273

Access Statistics for this article

More articles in Journal of Credit Risk from Journal of Credit Risk
Bibliographic data for series maintained by Thomas Paine ().