This Article reports results of an empirical study that suggests that the current economic crisis has changed managerial behavior in the US in a way that may impede economic recovery. The study finds a strong, statistically significant and economically meaningful, positive correlation between...

While executive compensation is often blamed for the excessive risk taking by banks, little is known about the operating performance incentives used in the finance industry both prior to and subsequent to the recent crisis. We provide a comprehensive analysis of incentive design -- the link of...

After several decades’ worth of federal and state regulatory intervention, the quality of the environment in the United States is markedly better today that it was at the founding of the modern environmental era. Nevertheless, environmental regulation remains the target of intense criticism,...

This paper examines the interaction between propensity to corrupt (PTC) and firm performance. First, I use unique data from Moscow traffic violations to build an individual measure of PTC for every Muscovite with a driver's license (3.1 million people). Next, I determine the PTC for the...

Standard anticorruption interventions consist of intensified monitoring and sanctioning. Rooted in principal-agent theory, these interventions are based on the assumption that corrupt acts follow a rational cost-benefit calculation by gain-seeking individuals. Given their mixed results, however,...

In the aftermath of the 2008 financial crisis, the Federal Deposit Insurance Corporation (FDIC) brought numerous lawsuits against directors and officers of failed banks asserting that they had breached their fiduciary duty of care. Under state corporate law, duty of care claims arise in...

Executive pay regulation is widely discussed as a measure to reduce financial mismanagement in corporations. We show that the professional team sports industry, the only industry with substantial experience in the regulation of compensation arrangements, provides valuable insights for the...