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turnover policy reaches efficiency; the manager is never retained if it is inefficient to do so. The manager’s compensation …
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To investigate how the possibility of earnings manipulation affects managerial compensation contracts, we study a two period agency setting in which a firm's manager can engage in "window dressing" activities to manipulate reported accounting earnings. Earnings manipulation boosts the reported...
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earnings management (REM). The study results show that overconfident managers are more likely to adopt REM than AEM …
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This paper examines managerial compensation in an environment where managers may take a hidden action that affects the … contract in this setting, and demonstrate that contracts contingent on reported earnings cannot provide managers with the …
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