Discrimination, managers, and firm performance: evidence from “Aryanizations” in Nazi Germany

Huber, Kilian, Lindenthal, Volker and Waldinger, Fabian (2019) Discrimination, managers, and firm performance: evidence from “Aryanizations” in Nazi Germany. CEP Discussion Papers (CEPDP1599). London School of Economics and Political Science. Centre for Economic Performance, London, UK.

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Abstract

Large-scale increases in discrimination can lead to dismissals of highly qualified managers. We investigate how expulsions of senior Jewish managers, due to rising discrimination in Nazi Germany, affected large corporations. Firms that lost Jewish managers experienced persistent reductions in stock prices, dividends, and returns on assets. Aggregate market value fell by roughly 1.8 percent of German GNP because of the expulsions. Managers who served as key connectors to other firms and managers who were highly educated were particularly important for firm performance. The findings imply that individual managers drive firm performance. Discrimination against qualified business leaders causes first-order economic losses.

Item Type:	Monograph (Discussion Paper)
Official URL:	https://cep.lse.ac.uk/_new/publications/discussion...
Additional Information:	© 2019 The Authors
Divisions:	Centre for Economic Performance
Subjects:	H Social Sciences > HC Economic History and Conditions H Social Sciences > HD Industries. Land use. Labor
JEL classification:	J - Labor and Demographic Economics > J7 - Labor Discrimination > J71 - Discrimination M - Business Administration and Business Economics; Marketing; Accounting > M2 - Business Economics > M21 - Business Economics N - Economic History > N8 - Micro-Business History > N84 - Europe: 1913-
Date Deposited:	25 Nov 2019 11:42
Last Modified:	14 Sep 2024 04:07
URI:	http://eprints.lse.ac.uk/id/eprint/102613

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