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Motivated by agency theory, we explore how independent directors view managerial risk-taking incentives using a natural experiment. We exploit the passage of the Sarbanes-Oxley Act as an exogenous shock that raised board independence. Our difference-in-difference estimates show that independent...
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This paper studies how altruism between managers and employees affects relational incentive contracts. To this end we …. The contract may contain two types of incentives for the agent to work hard: a bonus and a threat of dismissal. We find …
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