Leading for the Long Term∗

Existing economic models of leadership (e.g., Hermalin, 1998) consider leadership in a static setting only. Yet an important phenomenon of leadership is its persistence. One aspect of leadership, for instance, that is unexplorable in a static setting is reputation: The leader develops a reputation for leading her followers well. To allow for reputation effects and other behaviors that make sense only in repeated games — such as the followers’ paying the leader tribute — this paper considers a repeated-game version of Hermalin’s earlier model. Contact Information: Professor Benjamin E. Hermalin University of California Walter A. Haas School of Business s Student Services Bldg. #1900 Berkeley, CA 94720–1900 Email: [email protected] ∗The author thanks Aaron Edlin, Bob Frank, Werner Güth, Barry Nalebuff, Bernard Sinclair-Desgagné, Simon Wakeman, and participants at the eap research lunch, the Berkeley theory seminar, the ids  workshop, and the Leadership & Social Interactions Conference, Lyons, France for helpful comments and suggestions.