The use of stock-based compensation for U.S. CEOs has increased significantly throughout the 1990s. Research interest, in particular on stock option compensation, has similarly increased, yet contradictory results create questions about the theoretical underpinnings. Therefore, we revisit the...

The pay-performance sensitivity of Japanese CEO compensation is systematically associated with both firm characteristicsand individual attributes as invoked from agency theory and human capital theory. The results support the hypothesis that continuous monitoring by the main bank and other...

We explore whether the association between accruals and future returns documented by Sloan (1996) is due to fixation by naive investors on the total amount of reported earnings without regard for the relative magnitude of the accrual and cash flow components. Contrary to the predictions of the...

We examine the agency-theory-based economic determinants of the firm-specific CEO compensation-performance sensitivity by using CEO cash compensation (salary plus bonus) as the proxy for CEO compensation and annual accounting earnings as the measure of firm performance. From agency theory, the...

Much of the existing empirical evidence on the use of stock option compensation conflicts with theoretical predictions. This has led some to conclude that the theories are incomplete or that stock option compensation policies are not optimal, on average. However, most studies use data from the...

This study tests whether firms in the electric utility industry alter their compensation policies in response to the recent and dramatic changes that the 1992 Energy Policy Act imposes on their operating and regulatory environment. The 1992 Act intensifies competition in the utility industry by...

This paper shows that the book-to-market (B/M) effect is greater for stocks with higher idiosyncratic return volatility, higher transaction costs and lower investor sophistication, consistent with the market mispricing explanation for the anomaly. The B/M effect for high volatility stocks...

Frankel and Lee (1998) show that the value-to-price ratio (Vf/P) predicts future abnormal returns for up to three years, where Vf is an estimate of fundamental value based on a residual income valuation framework operationalized using analyst earnings forecasts. In this study, we examine whether...

Using financial accounting data from manufacturing firms in 16 countries for 1986-1995, we demonstrate that the value relevance of financial reports is lower for countries where the financial systems are bank-oriented rather than market-oriented; where private sector bodies are not involved in...

The use of stock-based compensation for U.S. CEOs has increased significantly throughout the 1990s. Research interest, in particular on stock option compensation, has similarly increased, yet contradictory results create questions about the theoretical underpinnings. Therefore, we revisit the...