and cannot observe the manager's total effort. The managers of incumbent firms allocate their effort to two different … effort, and an "effort substitution effect" that makes managers exert more productive effort and less unproductive effort …

that managers can engage in real smoothing using derivatives like forward and futures contracts which have a simple product …

), vega (wealth-to-volatility sensitivity) of managers' wealth, and the relative size of stock option compensation. For … industry and that the current compensation scheme is not too excessive to lead bank managers to higher level of leverage and …

(the largest shareholder ownership) increases, the managers' incentives become more closely aligned with those of the … (the largest shareholder ownership) exceeds a certain level, the managers can have their positions more secured and become … more interested in their private interests instead of the shareholders val . This induces the managers to reduce the bank …