Discussion paper

DP15828 Trainspotting: Board Appointments in Private Firms

This paper examines how the size of the corporate directors’ labor market affects board appointments in Italian private limited liability firms. As an exogenous shock to a firm’s access to potential non-local directors, we exploit the gradual expansion of the high-speed railway network that improves intercity mobility. We find that the non-local supply of directors increases the positive assortative matching between directors and firms: high-quality firms improve the quality of their boards, while low-quality firms reduce it. We also show that director quality is positively associated with firm growth and productivity, and negatively associated with the probability of default.


Baltrunaite, A and E Karmaziene (2021), ‘DP15828 Trainspotting: Board Appointments in Private Firms‘, CEPR Discussion Paper No. 15828. CEPR Press, Paris & London. https://cepr.org/publications/dp15828