The allure of company towns

The allure of company towns

Leading a large firm in a small community often influences decision making. When corporate choices impact local neighbors, friends, and family, leaders are more incentivized to make thoughtful decisions.

Research on hometown CEOs supports this idea; they tend to have stronger ties to their company’s location and greater concern for their local reputation.

Studies indicate that these leaders are less inclined to cut R&D budgets under short-term pressures or take risks like increasing leverage. Whether this reflects long-term thinking or caution depends on one’s perspective.

Source: https://www.economist.com/business/2025/01/30/the-allure-of-the-company-town