We examine outside CEO succession for 528 firms during the period 1993–2009. Announcement-period returns are positive, but higher for firms hiring from within their industry than from a different industry. However, unlike the year following succession, firms hiring from a different industry...

We provide a simple asymmetric information model showing that, in contrast to portfolio diversification arguments, there is a natural complementarity between executive options and stock ownership. Moreover, managers can be made worse off by being granted more executive options.

This study examines the effects of shareholder support for equity compensation plans on subsequent chief executive officer (CEO) compensation. Using cross-sectional regression, instrumental variable, and regression discontinuity research designs, we find little evidence that either lower...

We study changes in the design of CEO contracts when firms transition from being public with dispersed shareholders to having strong principals in the form of private equity sponsors. These principals redesign some, but far from all, contract characteristics. There is no evidence that they...

This paper develops an equilibrium matching model for a competitive CEO market in which CEOs’ wage and perks are both endogenously determined by bargaining between firms and CEOs. In stable matching equilibrium, firm size, wage, perks and talent are all positively related. Perks are more...

In this paper, I consider the evidence for three common perceptions of U.S. public company CEO pay and corporate governance: (1) CEOs are overpaid and their pay keeps increasing; (2) CEOs are not paid for their performance; and (3) boards do not penalize CEOs for poor performance. While average...

This paper provides a brief overall view of the previous research carried out on gender diversity and shows how, against all expectations, the presence of women in the boardrooms cannot affect firms’ leverage and total risk. We draw on theories from psychological, social and economic issues...

The trends in executive pay and labor income tax rates since the 1940s suggest a high elasticity of taxable income with respect to tax policy. By contrast, the level and structure of executive compensation have been largely unresponsive to tax incentives since the 1980s. However, the relative...

Agency theory suggests that high pay-performance sensitivity (PPS) of CEO's compensation is an important motivation mechanism to the CEO to improve corporate performance. We develop a simple model that suggests that reverse causality should also be considered. Specifically, our model predicts...

This paper examines the relationship between CEO pay and firm performance within a sample of European publicly listed energy utilities from 2000 to 2010, focusing on the differential responses that arise from being subject to different regulatory regimes. In particular, we investigate the...