We model the effects of competition on managerial efficiency and isolate the agency effect of competition, present only in firms subject to agency costs, from the direct pressure effect of competition, which is present in all firms. Using a unique set of Canadian data that surveys both firms and...

We model the effects of product market competition on managerial efficiency, and isolate the agency effect of competition, which is present only in firms subject to agency costs, from the direct pressure effect, which is present in all firms. Using a unique set of Canadian data which allows us...