Using a theoretical extension of the Friedman and Savage (1948) utility function developed in Bhattacharyya (2003), we predict that for financial assets with negative expected returns, expected return will be a declining and convex function of skewness. Using a sample of U.S. state lottery...

Bhattacharyya (2007) develops a model in which compensation contracts motivate high-quality managers to retain and invest firm earnings, while low-quality managers are motivated to distribute income to shareholders. In equilibrium, the model shows that there is a positive (negative) relationship...

This study provides empirical evidence on the relationship between dividend payout ratios, executive compensation and agency costs in Italy. Corporate governance in Italy is distinguished by the fact that a large number of Italian firms are family controlled, which may theoretically reduce...

Purpose -This paper seeks to present and test a model of the association between dividend payout and executive compensation. Design/methodology/approach - The authors develop a model based on Bhattacharyya whereby managerial quality is unobservable to shareholders, and therefore first-best...

Purpose – Finance theory proposes that consumers require information about the risk‐return trade‐off credibility information to relieve principal‐agent conflict concerns, and transaction cost information – for investment decisions. This paper aims to investigate whether or not such...

Purpose – This paper seeks to present and test a model of the association between dividend payout and executive compensation. Design/methodology/approach – The authors develop a model based on Bhattacharyya whereby managerial quality is unobservable to shareholders, and therefore...