The essays in this thesis study stock option schemes and CEO compensation in the publicly listed Finnish firms. The first essay studies the determinants of option scheme adoption. It argues that firms with a higher level of market value per employee are able to provide economic incentives for...

While theorists differ sharply on the expected economic impact of stock options, typically empirical work has found a positive association between option schemes and firm productivity. However, existing data are limited and may not enable reliable investigation of the productivity effects of...

In this paper we study whether stock option schemes affect firm technical inefficiency. We estimate Cobb-Douglas stochastic production frontier models using a novel panel data set on the publicly listed Finnish firms in the manufacturing and ICT sectors over the period from 1992 to 2002. We find...

This paper examines how CEO pay is related to firm size and to firm performance in Finland by using new individual-level compensation data in 1996-2002. We find robust evidence that CEO average compensation has increased substantially between 1996 and 2002. For example, the ratio between CEO and...