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Disentangling managerial incentives from a dynamic perspective : the role of stock grants

Hili, Amal; Laussel, Didier; Long, Ngo Van - 2016

We analyze the optimal contract between a risk-averse manager and the initial shareholders in a two-period model where the manager's investment effort, carried out in period 1, and her current effort, carried out in period 2, both impact the second-period profit, so that it may be difficult to...

Persistent link: https://www.econbiz.de/10011538964

Managerial hedging and portfolio monitoring

Bisin, Alberto (contributor); Gottardi, Piero (contributor); … - 2004

Incentive compensation induces correlation between the portfolio of managers and the cash flow of the firms they manage …. This correlation exposes managers to risk and hence gives them an incentive to hedge against the poor performance of their …

Persistent link: https://www.econbiz.de/10002521243

Corporate deductibility provisions and managerial incentives

Köthenbürger, Marko; Stimmelmayr, Michael - 2013

findings suggest that, when managers engage in wasteful capital expenditures, welfare may decline if the cost of investment is …

Persistent link: https://www.econbiz.de/10010227267

Management incentives under formula apportionment : tax-induced distortions of effort and compensation in a principal-agent setting

Martini, Jan T.; Niemann, Rainer; Simons, Dirk - 2014

compensation to managers in low-tax jurisdictions, if payroll enters the FA formula. Managers in high-tax jurisdictions face the …

Persistent link: https://www.econbiz.de/10010383849

A theory of tax avoidance : managerial incentives for tax planning in a multi-task principal-agent model

Ewert, Ralf; Niemann, Rainer - 2014

We derive determinants of tax avoidance by means of a multi-task principal-agent model. We extend prevailing models by integrating both corporate and individual income taxation as well as by including tax planning effort in the agent’s action portfolio. Our model shows novel and apparently...

Persistent link: https://www.econbiz.de/10010367166

Yes, managers should be paid like bureaucrats

Frey, Bruno S. (contributor); Osterloh, Margit (contributor) - 2005

. Agency theory’s insistence on linking the compensation of managers and directors as closely as possible to firm performance …

Persistent link: https://www.econbiz.de/10002572375

Do firms gain from managerial overconfidence? : the role of severance pay

Graziano, Clara; Luporini, Annalisa - 2022

We analyze the effects of optimism and overconfidence when the manager's compensation package includes severance pay and the CEO has bargaining power. We find that optimism does not affect incentive pay but increases severance pay with a negative effect on profit. Overconfidence, on the...

Persistent link: https://www.econbiz.de/10013255972

CEO compensation

Frydman, Carola; Jenter, Dirk - 2010

result of powerful managers setting their own pay. Others interpret high pay as the result of optimal contracting in a …

Persistent link: https://www.econbiz.de/10008797772

CEO compensation : evidence from the field

Edmans, Alex; Gosling, Tom; Jenter, Dirk - 2021

We survey directors and investors on the objectives, constraints, and determinants of CEO pay. 67% of directors would sacrifice shareholder value to avoid controversy on CEO pay, implying they face significant constraints other than participation and incentive compatibility. These constraints...

Persistent link: https://www.econbiz.de/10012584217

Strategic delegation in experimental markets

Huck, Steffen; Müller, Wieland; Norman, Hans-Theo - 2000

contracts which determine their managers' salaries. One contract simply gives managers incentives to maximize firm profits …, while the second contract gives an additional sales bonus. Although theory predicts the second contract to be chosen, it is … only rarely chosen in the experimental markets. This behavior is rational given that managers do not play according to the …

Persistent link: https://www.econbiz.de/10009781566

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