This paper shows that offering a fixed wage maximizes the principal's welfare when the agent needs to engage in multitask and that the effort needed to achieve one task can be induced by suppressing the effort needed for the other task, in the absence of externalities. In the existing...

Labour contracts tend to be more complicated than one simple short or long-term contract which is the basis of previous studies. Combinations of different length contracts become essential when principals expect to maximize not only verifiable outputs but also observable but unverifiable...

It is widely believed that corporate boards are overly reluctant to fire their CEOs. The conventional explanation for retaining a CEO regardless of his/her talent is that a CEO chooses the board members and has the power to fire them. However, very few studies have investigated how a new CEO is...

This paper analyses two pronounced features of Japanese corporate governance : large corporate boards almost entirely composed of insiders and the tendency to appoint CEOs through internal promotions. It is often argued that Japanese boards are less effective in monitoring CEOs than U.S. boards...

Do corporate boards look after shareholder interests? This paper shows that CEO replacement may exhibit excessive inertia, in favor of the incumbent board of directors. I show that even when there is no relationship between the board of directors and CEO, or no threat of the CEO.s power over the...

This paper analyses two pronounced features of Japanese corporate governance--large corporate boards almost entirely composed of insiders and the tendency to appoint CEOs through internal promotions. It is often argued that Japanese boards are less effective in monitoring CEOs than U.S. boards...

It is widely believed that corporate boards are overly reluctant to fire their CEOs. The conventional explanation for retaining a CEO regardless of his/her talent is that a CEO chooses the board members and has the power to fire them. However, very few studies have investigated how a new CEO is...