A crucial assumption in the optimal auction literature has been that each bidder's valuation is known to be drawn from a single unique distribution. In this paper we relax this assumption and study the optimal auction problem when there is ambiguity about the distribution from which these...

We introduce a computer program which calculates an agent’s optimal behavior according to Case-based Decision Theory (Gilboa and Schmeidler, 1995) and use it to test CBDT against a benchmark set of problems from the psychological literature on human classification learning (Shepard et al.,...

While recent studies show that long vesting periods in managerial compensation increase corporate investments, it may reshape the shareholder-debtholder conflict as shareholders have to split the gains with creditors. We find that firms with longer CEO pay durations use more short-maturity...

Bolton, Scheinkman, and Xiong (2006) model a setting where investors disagree and short-sales constraints cause pessimistic views of stock prices to be less influential, which leads to speculative stock prices. A theoretical implication of the model is that existing shareholders can exploit the...

We examine the effect of technology spillovers on the duration of executive compensation contracts. We find that in the presence of greater technology spillovers, firms tend to grant longer duration compensation contracts to their executives. This finding is consistent with theoretical...

We develop a conceptual framework that links executive compensation incentives to the external risks and returns generated by the firm but borne by society. Recent advances in measuring liquidity creation (Berger and Bouwman, 2009) and systemic risk (Acharya, et al. forthcoming) allow us to...