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The Impact of Managerial Quality on Organizational Performance: Evidence from German Soccer

Bernd Frick () and Robert Simmons ()
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Bernd Frick: Witten/Herdecke University

No 708, Working Papers from International Association of Sports Economists, North American Association of Sports Economists

Abstract: Although a considerable literature exists on determinants of managerial compensation, much of it focussing on the role of incentives, there is much less known about the im-pact of managerial remuneration and quality upon attainment of organizational goals. In this paper we use a novel panel data set from the German premier soccer league (Bundesliga) as a case to show how variations in managerial compensation impact posi-tively upon organizational (team) success. This positive impact is revealed using sto-chastic frontier production function estimation. Given a particular amount of spending on players relative to the rest of the Bundesliga, a team that hires a better quality coach can expect to achieve a higher points score by reducing technical inefficiency. However, our results also suggest that the market for head coaches may be allocatively inefficient in that coaches are paid below their marginal revenue products.

Keywords: head coaches; soccer; efficiency; stochastic frontier analysis (search for similar items in EconPapers)
JEL-codes: J44 L83 M50 (search for similar items in EconPapers)
Pages: 20 pages
Date: 2007-04
New Economics Papers: this item is included in nep-bec, nep-eff, nep-hrm, nep-lab, nep-mkt and nep-spo
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http://web.holycross.edu/RePEc/spe/FrickSimmons_Managers.pdf (application/pdf)

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