This paper looks at divestitures by 144 UK firms listed on the London Stock Exchange from 1985 to 1991 and investigates whether and how accurately investors price the firm's option to abandon assets in exchange for their exit value. Theory prices this real option as an American style put and the...

Previous literature shows that employee ownership can be used as a reward management tool or as entrenchment mechanism. This paper develop a model suggesting that employee ownership policy reveals management quality. Good managers would use employee ownership as a reward management tool whereas...

Employee ownership is often used as a reward management tool but also as entrenchment mechanism. This paper develops a model suggesting that employee ownership policy reveals management quality. Good managers would use employee ownership as a reward management tool whereas bad managers would...

Since Enron and the ruin of thousands of its employees, employee ownership is harshly criticized. Investing savings in employer’s stock would be equivalent to bet on only one asset. Moreover, employee ownership’s debated efficiency would not justify employers to grant company stock to their...