This paper develops a simple competitive model of CEO pay. A large part of the rise in CEO compensation in the US economy is explained without assuming managerial entrenchment, mishandling of options, or theft. CEOs have observable managerial talent and are matched to assets in a competitive...

This paper develops a simple competitive model of CEO pay. A large part of the rise in CEO compensation in the US economy is explained without assuming managerial entrenchment, mishandling of options, or theft. CEOs have observable managerial talent and are matched to assets in a competitive...

This note is a brief, non-technical summary of a framework that delivers tractable incentive contracts in broad settings that require few restrictions on the utility function, cost function and noise distribution, and are achievable in discrete time. The framework was developed in Edmans and...