Working Paper: NBER ID: w25853
Authors: Katharina Janke; Carol Propper; Raffaella Sadun
Abstract: We investigate whether top managers affect the performance of large and complex public sector organizations, using as a case study CEOs of English public hospitals (large, complex organizations with multi-million turnover). We study the extent to which CEOs are differentiated in terms of their pay, as well as a wide range of hospital production measures including inputs, intermediate operational outcomes and clinical outcomes. Pay differentials suggest that the market perceives CEOs to be differentiated. However, we find little evidence of CEOs’ impact on hospital production. These results question the effectiveness of leadership changes to improve performance in the public sector.
Keywords: CEOs; Public Sector; NHS; Hospital Performance; Management
JEL Codes: H51; I11; L32; M12; M5
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| CEO assignments (M12) | hospital production outcomes (D29) |
| CEO pay (M12) | perceived performance (L25) |
| CEO performance (M12) | hospital performance (I11) |
| CEO characteristics (M12) | hospital production outcomes (D29) |
| CEO fixed effects (C23) | hospital production data (Y10) |