Managers and (secret) social networks

The influence of the freemasonry on a firm's performance

Research output: Contribution to journalArticleScientificpeer-review

Abstract

In this paper, I study the impact of managers’ affiliations with the Freemasonry on the performances of companies. Using a unique data set of 412 companies quoted on the London Stock Exchange between 1895 and 1902, I find that young and small firms run by Masonic managers exhibited larger leverage ratios. These companies earned higher profits, although the effect is not statistically significant. Large publicly quoted corporations managed by Freemasons instead had lower profits and lower Tobin’s Q. I discuss the issue of the endogeneity of Freemasonry membership, and I use four different approaches to partially address this.
Original languageEnglish
Pages (from-to)1053-1081
JournalJournal of the European Economic Association
Volume9
Issue number6
DOIs
Publication statusPublished - 2011

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Managers
Social networks
Profit
Firm performance
Endogeneity
Small firms
London Stock Exchange
Leverage ratio
Tobin's Q

Cite this

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title = "Managers and (secret) social networks: The influence of the freemasonry on a firm's performance",
abstract = "In this paper, I study the impact of managers’ affiliations with the Freemasonry on the performances of companies. Using a unique data set of 412 companies quoted on the London Stock Exchange between 1895 and 1902, I find that young and small firms run by Masonic managers exhibited larger leverage ratios. These companies earned higher profits, although the effect is not statistically significant. Large publicly quoted corporations managed by Freemasons instead had lower profits and lower Tobin’s Q. I discuss the issue of the endogeneity of Freemasonry membership, and I use four different approaches to partially address this.",
author = "F. Braggion",
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Managers and (secret) social networks : The influence of the freemasonry on a firm's performance. / Braggion, F.

In: Journal of the European Economic Association, Vol. 9, No. 6, 2011, p. 1053-1081.

Research output: Contribution to journalArticleScientificpeer-review

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AB - In this paper, I study the impact of managers’ affiliations with the Freemasonry on the performances of companies. Using a unique data set of 412 companies quoted on the London Stock Exchange between 1895 and 1902, I find that young and small firms run by Masonic managers exhibited larger leverage ratios. These companies earned higher profits, although the effect is not statistically significant. Large publicly quoted corporations managed by Freemasons instead had lower profits and lower Tobin’s Q. I discuss the issue of the endogeneity of Freemasonry membership, and I use four different approaches to partially address this.

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DO - 10.1111/j.1542-4774.2011.01031.x

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