Purpose -This paper seeks to present and test a model of the association between dividend payout and executive compensation. Design/methodology/approach - The authors develop a model based on Bhattacharyya whereby managerial quality is unobservable to shareholders, and therefore first-best...

Purpose – Finance theory proposes that consumers require information about the risk‐return trade‐off credibility information to relieve principal‐agent conflict concerns, and transaction cost information – for investment decisions. This paper aims to investigate whether or not such...

Purpose – This paper seeks to present and test a model of the association between dividend payout and executive compensation. Design/methodology/approach – The authors develop a model based on Bhattacharyya whereby managerial quality is unobservable to shareholders, and therefore...