Do managers matter? Evidence from Italian football.

The thesis studies the impact of the managerial replacements on the performance of the organizations. Specifically, the effectiveness of the decisions to dismiss the managers is investigated with reference to the football sector because data about the results of the teams and the turnovers of the managers are publicly observable at high frequency and without uncertainty. In particular, the thesis analyses the role of the football managers, the impact of their abilities on the performance of the football teams, the determinants of coach dismissals and the economic and sporting consequences of managerial replacements. The study is focused on the Italian Serie A and it takes into consideration all the in-season managerial replacements that take place from the season 2007/2008 to the season 2016/2017 with the final aim of making a comparison between the sports performance of the football clubs in case of managerial replacement and the performance of the football clubs in the event of no managerial substitution. Consequently, average points, cumulative points, surprise in points and cumulative surprise are used as proxies of the sports performance and, in detail, market average betting odds, adjusted according to the bookmaker’s margin, are used in order to compute the deviations from the performance expectations of the football teams. The thesis also includes five case studies in which the performance of the football clubs that fire their coaches, due to bad outcomes, is compared with the performance of the same clubs when the coaches are allowed to stay even though the outcomes, at the time of the potential dismissal, are almost identical to the case of managerial replacement. The conclusive result of the thesis is represented by the fact that in the majority of the cases the decision to substitute the manager turns out to be ineffective and counter-productive because the sports performance in the event of managerial turnover is on average worse than in the case in which the coaches are allowed to stay until the end of the season. Therefore, in light of this result, relevant reasons behind the decision to dismiss the manager seem to be the shock effect, the risk of relegation and the desire to find a scapegoat to blame for the bad sports results.