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 …

managers. Flows respond quickly and strongly to performance; lagged performance has a monotonically decreasing impact on flows … times as large as direct incentives from incentive fees and returns to managers' own investment in the fund. For new funds … generated for their investors in a given year, managers receive close to another dollar in direct performance fees plus the …

This paper examines managerial compensation in an environment where managers may take a hidden action that affects the … contract in this setting, and demonstrate that contracts contingent on reported earnings cannot provide managers with the …

. We derive the optimal compensation contracts for managers and demonstrate that the use of high-powered incentives will be … limited by the need to soften product market competition. In particular, when managers can be compensated based on their own …

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 …

Firms are more complicated than standard principal-agent theory allows: firms have assets-in-place; firms endure … through time, allowing for the possibility of replacing a shirking manager; firms have many managers, constraining the amount …

: reducing the opportunity for managers to transfer value to equityholders from creditors via strategic default, and reducing the …