contracts which determine their managers' salaries. One contract simply gives managers incentives to maximize firm profits …, while the second contract gives an additional sales bonus. Although theory predicts the second contract to be chosen, it is … only rarely chosen in the experimental markets. This behavior is rational given that managers do not play according to the …

findings suggest that, when managers engage in wasteful capital expenditures, welfare may decline if the cost of investment is …

compensation to managers in low-tax jurisdictions, if payroll enters the FA formula. Managers in high-tax jurisdictions face the …

. Agency theory’s insistence on linking the compensation of managers and directors as closely as possible to firm performance …

managers. We question this view within its own analytical framework by studying, in a principal-agent model, the effects of … diversion overlooks a significant cost of such behavior. Many common modes of compensation can provide managers with incentives …

executive officers. However, firms are run by teams of managers, and a theory of the firm should also explain the distribution …

Stock-based compensation is the standard solution to agency problems between shareholders and managers. In a dynamic … managers to work harder, it also induces them to hide any worsening of the firm's investment opportunities by following largely …-valued while managers hide the bad news to shareholders. We find that a firm-specific compensation package based on both stock and …