This study analyzes the role of three incentive devices in managerial compensation: pay for performance, termination, and career concerns. A model is derived which shows that the three incentives are substitutes; where the termination (or career concerns) incentive is low, the optimal contract...

This paper studies optimal compensation contracts in the presence of both pay-for-performance and termination incentives. While these incentives have been studied independently, this paper s model is the first to incorporate both. The primary result is that pay-for-performance and the threat of...

A change in executive leadership is a significant event in the life of a firm. Our paper investigates a potentially significant consequence of a CEO turnover: a change in equity volatility. We develop several hypotheses about how CEO changes might affect stock price volatility, and test these...

We study benefits received by target company CEOs in completed mergers and acquisitions.These executives obtain wealth increases with a median of $4 to $5 million and a mean of $8 to $11 million, roughly in line with the permanent income streams that they sacrifice. CEOs receive lower financial...

We study benefits received by target company CEOs in completed mergers and acquisitions. These executives obtain wealth increases with a median of $4 to $5 million and a mean of $8 to $11 million, roughly in line with the permanent income streams that they sacrifice. CEOs receive lower financial...

Because sell-side analysts are dependent on institutional investors for performance ratings and trading commissions, we argue that analysts are less likely to succumb to investment banking or brokerage pressure in stocks highly visible to institutional investors. Examining a comprehensivesample...

Due to institutional investors' increasing ownership and interest in corporate governance, we hypothesize that the presence of institutional investors is associated with certain executive compensation structures. We find a significantly negative relation between the level of compensation and the...

Because sell-side analysts are dependent on institutional investors for performance ratings and trading commissions, we argue that analysts are less likely to succumb to investment banking or brokerage pressure in stocks highly visible to institutional investors. Examining a comprehensivesample...