We investigate the effect of financial incentives, framed as gains and losses, on creative breakthrough. Rather than originating merely from diligent work, creative breakthrough entails a eureka-moment – the sudden insight and the radical reorganization of ideas for the solution of a problem....

The introduction of a common consolidated corporate tax base (CCCTB) and tax allocation via formula apportionment (FA) is hotly debated in the European Union (EU) since more than a decade. While the literature has thoroughly analyzed the economic effects of FA from a macro-level perspective, the...

The introduction of a common consolidated corporate tax base (CCCTB) and tax allocation via formula apportionment (FA) is hotly debated in the European Union (EU) since more than a decade. While the literature has thoroughly analyzed the economic effects of FA from a macro-level perspective, the...

This paper adds to the empirical evidence on the extent to which stock-based pay incentivizes and rewards European corporate executives. It shows that the actual realized gains (that is, take-home compensation) from stock-based pay of CEOs in European publicly-listed firms may be underestimated...

Using unique hand-collected data on CEO compensation packages retrieved from the largest 59 European banks from 16 Western European countries for the period from 2000 to 2008 this paper provides empirical evidence that both variable cash-based and variable equity-based compensation are...

The revised Markets in Financial Instruments Directive, known as MiFID II, requires the unbundling of research payments from trading execution. Using a difference-in-differences research design, we examine whether this regulation achieved its intended objective. We find that MiFID II weakened...

A central question in designing optimal policies concerns the assignment of individuals with different observable characteristics to different treatments. We study this question in the context of increasing workers' performance by using targeted incentives based on measurable worker...

The objective of this paper is to derive the characteristics of an effective fiscal governance framework, focusing on the incentives that ensure a commitment to the fiscal rules. We study this problem with the use of econometric tools, complementing this analysis with formal modelling through...

This paper contributes to the ongoing debate on fiscal consolidation and the questionable effectiveness of the Stability and Growth Pact by addressing the problem of economic governance in the EMU with a game-theoretic principal-agent approach. Following the theory of delegation, we develop a...