Performance Pay And Risk Aversion
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Performance Pay And Risk Aversion
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Author : Christian Grund
language : en
Publisher:
Release Date : 2006
Performance Pay And Risk Aversion written by Christian Grund and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 2006 with categories.
Risk Aversion Performance Pay And The Principal Agent Problem
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Author : Joseph G. Haubrich
language : en
Publisher:
Release Date : 1991
Risk Aversion Performance Pay And The Principal Agent Problem written by Joseph G. Haubrich and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 1991 with Chief executive officers categories.
The Impact Of Risk Aversion And Stress On The Incentive Effect Of Performance Pay
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Author : Charles Bram Cadsby
language : en
Publisher:
Release Date : 2009
The Impact Of Risk Aversion And Stress On The Incentive Effect Of Performance Pay written by Charles Bram Cadsby and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 2009 with categories.
Risk Aversion And Effort In An Incentive Pay Scheme With Multiplicative Noise
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Author : Nick Zubanov
language : en
Publisher:
Release Date : 2012
Risk Aversion And Effort In An Incentive Pay Scheme With Multiplicative Noise written by Nick Zubanov and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 2012 with categories.
The application of the classical "linear" model of incentive pay to the case when the noise is multiplicative to effort generates two predictions for a given strength of incentives: 1) more risk-averse workers will put in less effort, and 2) setting a performance target will weaken the negative risk aversion--effort link. The data from a real-effort laboratory experiment involving 85 student participants support both these predictions. Implications of the model and empirical findings to the literature on, and practice of, personnel management are discussed.
Sorting Effects Of Performance Pay
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Author : Maris Goldmanis
language : en
Publisher:
Release Date : 2013
Sorting Effects Of Performance Pay written by Maris Goldmanis and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 2013 with categories.
Compensation not only provides incentives to an existing manager, but also affects the type of manager attracted to the firm. This paper examines the dual incentive and sorting effects of performance pay in a simple contracting model of endogenous participation. In general, sorting dampens optimal pay-performance sensitivity (PPS), as PPS beyond a nominal amount transfers unnecessary (information) rent to the manager. This helps explain why empirical estimates of PPS are much lower than predictions from models of moral hazard alone. The model also predicts that sorting under asymmetric information causes the firm to turn away more candidates than would be efficient; PPS increases in the cost of hiring the manager and in the manager's outside option, but decreases in output risk, information risk, and managerial risk-aversion; the firm becomes more selective in hiring as either the manager's outside option, the cost of hiring, risk-aversion, output risk, or information risk increases.
The Relationship Between Risk Incentive Pay And Organizational Performance
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Author : Matthew C. Bloom
language : en
Publisher:
Release Date : 1997
The Relationship Between Risk Incentive Pay And Organizational Performance written by Matthew C. Bloom and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 1997 with Incentive awards categories.
An Empirical Analysis Of The Role Of Risk Aversion In Executive Compensation Contracts
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Author : Erik Peek
language : en
Publisher:
Release Date : 2005
An Empirical Analysis Of The Role Of Risk Aversion In Executive Compensation Contracts written by Erik Peek and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 2005 with categories.
This paper empirically tests the principal-agent model prediction that the use of performance measures for incentive purposes is affected by the agent's risk aversion. We identify proxies for managerial risk aversion that can be measured using publicly available executive compensation data and find that the use of both accounting and market performance measures in executive compensation contracts decreases as the level of risk aversion increases. The contribution of this paper is twofold. First, we provide strong evidence of the relevance of incorporating risk aversion in executive compensation research. The results indicate that risk aversion has a significant effect on the use of performance measures, which suggests that future executive compensation research should therefore take the level of risk aversion into account. Second, the risk aversion proxies that we test are robust, simple, and can easily be measured using publicly available data. As a result, these proxies can be used in future accounting research other than in the executive compensation area, such as, research on earnings management, CEOs' financing and investment decisions, and voluntary disclosure issues.
Compensation And Organizational Performance
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Author : Luis R. Gomez-Mejia
language : en
Publisher: Routledge
Release Date : 2014-12-18
Compensation And Organizational Performance written by Luis R. Gomez-Mejia and has been published by Routledge this book supported file pdf, txt, epub, kindle and other format this book has been release on 2014-12-18 with Business & Economics categories.
This up-to-date, research-oriented textbook focuses on the relationship between compensation systems and firm overall performance. In contrast to more traditional compensation texts, it provides a strategic perspective to compensation administration rather than a functional viewpoint. The text emphasizes the role of managerial pay, its importance, determinants, and impact on organizations. It analyzes recent topics in executive compensation, such as pay in high technology firms, managerial risk taking, rewards in family companies, and the link between compensation and social responsibility and ethical issues, among others. The authors provide a thorough and comprehensive review of the vast literatures relevant to compensation and revisit debates grounded in different theoretical perspectives. They provide insights from disciplines as diverse as management, economics, sociology, and psychology, and amplify previous discussions with the latest empirical findings on compensation, its dynamics, and its contribution to firm overall performance.
How Relative Compensation Can Lead To Herding Behavior
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Author : An Chen
language : en
Publisher:
Release Date : 2013
How Relative Compensation Can Lead To Herding Behavior written by An Chen and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 2013 with categories.
In this paper we analyze performance-based remuneration for risk-averse managers in a Black Scholes-type model. We assume that the firm's performance is influenced by an industry and a firm-specific risk. A relative performance compensation which rewards a manager relative to the exogenous performance of the firms in his peer group, can filter out the industry-specific risk and lower the compensation costs to the firm. However, if all managers of the firms in the peer group receive an endogenous relative performance compensation, we show that the managers may herd in their investment decisions and choose an inferior investment despite the presence of a more profitable alternative. This herding behavior is driven by the managers' risk-aversion and the endogenous relative performance compensation.
Managerial Performance Incentives And Firm Risk During Economic Expansions And Recessions
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Author : Elif Şişli-Ciamarra
language : en
Publisher:
Release Date : 2015
Managerial Performance Incentives And Firm Risk During Economic Expansions And Recessions written by Elif Şişli-Ciamarra and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 2015 with categories.