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We examine how boards decide on CEO compensation depending on how informative stock prices are. In order to mitigate the endogeneity of board decisions, we use extreme mutual fund flow-driven trading pressure as an exogenous shock to stock price informativeness. Consistent with informed boards...
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We examine whether boards are sufficiently well-informed to make efficient decisions on CEO compensation. In order to mitigate the endogeneity of board decision on CEO compensation, we use mutual fund flow-driven trading pressure as an exogenous shock to stock price informativeness. Consistent...
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