Optimal CEO compensation: Some equivalence results

• 成果类型: Article
• 署名作者: Choe, CW
• 署名单位: University of New South Wales Sydney
• 刊物名称: JOURNAL OF LABOR ECONOMICS
• ISSN/ISSBN: 0734-306X
• DOI: 10.1086/497822
• 发表日期: 2006
• 页码: 171-201
• 关键词: incomplete contracts; golden parachutes; gathering information; performance pay; investments; RENEGOTIATION; options; RISK; incentives; earnings

摘要

I study optimal managerial contracts in two contracting environments. When the investment return is contractible, an optimal contract combines a base salary, golden parachute, and bonus. When the return is not contractible, two types of optimal contracts are studied: a contract with restricted stock and a contract with stock options. These three types of contracts are equivalent: they implement the same outcome and lead to the same expected payoff for the manager, implying that the choice of contractual form is irrelevant in the environment I study. I suggest directions of research for the relevance of different contractual forms.