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 …

constraints that act on these processes, leave managers with considerable power to shape their own pay arrangements. Examining the …

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 …

to be incompatible with the fact that the bulk of many high-profile managers' compensation is in the form of various …

managers have a preference for smooth time-paths of profits – as revealed by the empirical literature on ‘income smoothing … termination threats make collusion supportable at any discount factor, independent of contracts’ duration. When managers have …

. The effect is stronger the greater the competition for managers and the stronger the managerial bargaining power. While …

We propose a model in which better governance incentivizes managers to perform better and thus saves on the cost of … providing pay for performance. However, when managerial talent is scarce, firms' competition to attract better managers reduces … an individual firm's incentives to invest in corporate governance. In equilibrium, better managers end up at firms with …