In recent years there have been two parallel discussions taking place in the US and in the UK about the role which institutional shareholders should play in governing the corporation. In the US this discussion is around the idea of shareholder empowerment, in the UK it is around shareholder...

The extant literature has used measurements of CEO risk-taking incentives which do not include the effects of termination provisions such as severance agreements. This paper provides a general form model that allows for the valuation and computation of CEO compensation structures including...

We study a dynamic contracting problem in which the principal can allocate his limited capacity between seeking evidence that confirms or that contradicts the agent's effort, as the basis for reward or punishment. Such flexibility calls for jointly designed monitoring and compensation schemes...

We investigate the Dead Hand Proxy Put, a contractual innovation in corporate debt agreements that may impact hedge fund activism. We find the provision principally in loans, not bonds, and provide evidence linking adoption of the provision to hedge fund activism. Further, controlling for...

Commercial banks are typical hierarchical organizations, in which the multipleprincipal-agent problem exists and induces serious internal collusive corruption. This article analyzes the collusive corruption between credit supervisors and credit managers in bank credit activities, through three...

We show that on-demand insurance contracts, an innovative form of coverage recently introduced through the InsurTech sector, can serve as a screening device. To this end, we develop a new adverse selection model consistent with Wilson (1977), Miyazaki (1977) and Spence (1978). Consumers have...

This paper provides a theoretical model to examine when and how boards of directors can utilize outside experts who provide second opinions to assist them in 1) monitoring managers with career concerns, and 2) approving firm investments. Because an agreeable second opinion serves as a signaling...

In this study, insider trading activity is used as part of a managerial compensation structure. The wage structure changes with the tenure duration of the insider. Managers with shorter tenure rely more on insider profits as part of their compensation. On the other hand, managers with longer...

In the wake of the backdating scandal, many firms began awarding options at scheduled times each year. Scheduling option grants eliminates backdating, but creates other agency problems. CEOs that know the dates of upcoming scheduled option grants have an incentive to temporarily depress stock...

Over 20 years, M&A contracts have more than doubled in size – from 35 to 88 single-spaced pages in this paper's font. They have also grown significantly in linguistic complexity – from post-graduate “grade 20” to post-doctoral “grade 30”. A substantial portion (lower bound ~20%) of...