A manager's compensation contract and the level of resources available to him jointly influence his incentives to … optimal compensation contract induces investment allocations that are more aggressive than the first-best allocation …

executive compensation simply take it as a given. We argue, however, that in light of evolving corporate governance mechanisms … corporate governance mechanisms have evolved to duplicate incentive pay's positive incentive effects, thereby reducing its … now either minimally positive or even negative. We also argue that, given the strength of the corporate governance …