Strategic projects are mostly executed by teams of specialists, each of whom are responsible for the completion of specialized, uncertain, and, in many cases, interdependent tasks, i.e. a challenging triad. Unfortunately, senior management can rarely determine, or verifiably measure, the true...

While prior studies generally support that equity-based compensation induces CEOs to manipulate financial reporting, there is little direct empirical evidence on how concerns regarding financial misreporting affect compensation design. Exploiting the exogenous reduction in litigation threat...

How do we prevent financial institutions from taking excessive risk when the public fisc serves as their ultimate creditor? This is one of the central questions left over after the recent financial crisis and, for the past five years, there has been no shortage of proposed answers. Two of the...

The purpose of this research is to investigate factors that contribute to technology firms paying higher compensation than non-technology firms, and why the mix of compensation at technology firms is different than the compensation packages at non-technology firms. Using a sample of 1,009...

I investigate the consequences of executive stock option (ESO) risk incentives on risk-taking and future stock returns, conditional on past firm performance. Prior research documents a positive relation between compensation convexity (captured by “vega,” the sensitivity of CEO wealth to...

Compensation schemes have been blamed for encouraging excess risk-taking on the part of managers within the financial system and real economy. In general, compensation cannot decrease below the base salary, while gains from bonuses can be limitless. The potential link between compensation and...

We study interaction effects between intra-firm conflicts and interfirm competitionon a duopolistic market with seller firms employing one or more agents and imple-menting tournament incentives. We show that inter-firm competition leads to higherincentive intensity, higher efforts and output...

Group-based incentive pay is attractive in contexts where production is complex and interdependent, yet freeriding is a paramount concern. We assess the introduction of group-based performance pay in a modern industrial production setting using difference-in-difference estimation. Performance...

Group-based incentive pay is attractive in contexts where production is complex and interdependent, yet freeriding is a paramount concern. We assess the introduction of group-based performance pay in a modern industrial production setting using difference-in-difference estimation. Performance...