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Bonus Culture: Competitive Pay, Screening, and Multitasking
Bénabou, Roland; Tirole, Jean - C.E.P.R. Discussion Papers - 2013
This paper analyzes the impact of labor market competition and skill-biased technical change on the structure of compensation. The model combines multitasking and screening, embedded into a Hotelling-like framework. Competition for the most talented workers leads to an escalating reliance on...
Persistent link: https://www.econbiz.de/10011083769
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Managerial Power and Rent Extraction in the Design of Executive Compensation
Bebchuk, Lucian Arye; Fried, Jesse; Walker, David I - C.E.P.R. Discussion Papers - 2002
constraints that act on these processes, leave managers with considerable power to shape their own pay arrangements. Examining the …
Persistent link: https://www.econbiz.de/10005114260
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Executive Compensation as an Agency Problem
Bebchuk, Lucian Arye; Fried, Jesse - C.E.P.R. Discussion Papers - 2003
instrument for addressing the agency problem between managers and shareholders but also as part of the agency problem itself … managers. As a result, managers wield substantial influence over their own pay arrangements, and they have an interest in … reducing the saliency of the amount of their pay and the extent to which that pay is de-coupled from managers’ performance. We …
Persistent link: https://www.econbiz.de/10005662270
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Executive Compensation: A Modern Primer
Edmans, Alex; Gabaix, Xavier - C.E.P.R. Discussion Papers - 2015
This article studies traditional and modern theories of executive compensation, bringing them together under a unifying framework. We analyze assignment models of the level of pay, and static and dynamic moral hazard models of incentives, and compare their predictions to empirical findings. We...
Persistent link: https://www.econbiz.de/10011272716
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Managerial Incentives and Stock Price Manipulation
Peng, Lin; Röell, Ailsa A - C.E.P.R. Discussion Papers - 2009
This paper presents a rational expectations model of optimal executive compensation in a setting where managers are in … a position to manipulate short-term stock prices, and managers' propensity to manipulate is uncertain. Stock …
Persistent link: https://www.econbiz.de/10005014567
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The Old Boy Network: Gender Differences in the Impact of Social Networks on Remuneration in Top Executive Jobs
Lalanne, Marie; Seabright, Paul - C.E.P.R. Discussion Papers - 2011
Using an original dataset describing the career history of some 16,000 senior executives and members of the non-executive board of US, UK, French and German companies, we investigate gender differences in the use of social networks and their impact on earnings. There is a large gender wage gap:...
Persistent link: https://www.econbiz.de/10009351518
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Professional Network and Career Coevolution
Berardi, Nicoletta; Seabright, Paul - C.E.P.R. Discussion Papers - 2011
This paper examines how networks of professional contacts contribute to the development of the careers of executives of European and US companies. We build a dynamic model of career progression in which career moves both depend upon existing networks and contribute to the development of future...
Persistent link: https://www.econbiz.de/10009359489
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Tractability in Incentive Contracting
Edmans, Alex; Gabaix, Xavier - C.E.P.R. Discussion Papers - 2009
This paper identifies a class of multiperiod agency problems in which the optimal contract is tractable (attainable in closed form). By modeling the noise before the action in each period, we force the contract to provide sufficient incentives state-by-state, rather than merely on average. This...
Persistent link: https://www.econbiz.de/10008509464
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Dynamic Incentive Accounts
Edmans, Alex; Gabaix, Xavier; Sadzik, Tomasz; Sannikov, … - C.E.P.R. Discussion Papers - 2009
Contracts in a dynamic model must address a number of issues absent from static frameworks. Shocks to firm value may weaken the incentive effects of securities (e.g. cause options to fall out of the money), and the impact of some CEO actions may not be felt until far in the future. We derive the...
Persistent link: https://www.econbiz.de/10008477185
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Risk and the CEO Market: Why Do Some Large Firms Hire Highly-Paid, Low-Talent CEOs?
Edmans, Alex; Gabaix, Xavier - C.E.P.R. Discussion Papers - 2010
This paper presents a market equilibrium model of CEO assignment, pay and incentives under risk aversion and heterogeneous moral hazard. Each of the three outcomes can be summarized by a single closed-form equation. In assignment models without moral hazard, allocation depends only on firm size...
Persistent link: https://www.econbiz.de/10008530386