In contrast to a body of research starting with Demsetz and Lehn (1985) that predict and find a strong positive association between firm percent return variance and incentives, Aggarwal and Samwick (1999) predict and find a strong negative association between firm dollar return variance and...

We study how the existence of important production contracts affects the choice of CEO compensation contracts. We hypothesize that having major customers raises the costs associated with CEO risk-taking incentives and leads to lower option-based compensation. Using industry-level import tariff...

An examination of the executive compensation structure of 153 randomly-selected manufacturing firms in 1979-1980 provides evidence supporting advocates of incentive compensation, and also suggests that the form rather than the level of compensation is what motivates managers to increase firm...

This paper develops an analytical framework to study how corporate governance is shaped by product market globalization and technological progress. Using U.S. firm and industry level data, I first document two empirical patterns. First, higher levels of industry trade openness and productivity...

This essay analyses the relationship between corporate governance practices and Chief Executive Officer (CEO) wages from a sample of Portuguese listed companies over the period from 2002-2011. The relationship between CEO total compensation and shareholders return, firm characteristics, CEO...

I analyze 1,493 first-time director appointments to the boards of Fortune 1000 firms during 1997-1999, to investigate whether certain outside directors are better than others. I find that investor reactions to director appointments are significantly higher when appointees are CEOs of other firms...

We study management turnover for the top five executives in a sample of 443 large firms from 1993 through 1998. The rate of forced turnover for non-CEOs is at least as great as that for CEOs, but the sensitivity of turnover to firm performance is smaller for non-CEOs. The probability that a...

We study the problem of compensating a manager whose career concerns affect his investment strategy. We consider contracts that include cash, shares, and call options, focusing on the role of options in aligning incentives. We find that managers are optimally paid in cash, supplemented by a...

We model how a firm motivates a risk-averse CEO not only to exert productive effort but also to evaluate and to adopt new projects. Evaluation effort produces better information on risky projects, but the agent may reject a good project in order to avoid risk. Productive effort increases the...