The value and incentive effects of nontraditional executive stock option plans

• 成果类型: Article
• 署名作者: Johnson, SA; Tian, YS
• 署名单位: Louisiana State University System; Louisiana State University; York University - Canada; University System of Ohio; University of Cincinnati
• 刊物名称: JOURNAL OF FINANCIAL ECONOMICS
• ISSN/ISSBN: 0304-405X
• DOI: 10.1016/S0304-405X(00)00049-0
• 发表日期: 2000
• 页码: 3-34
• 关键词: executive stock options; Executive compensation; Option valuation; incentives

摘要

We examine the value and incentive effects of six nontraditional executive stock options: premium options, performance-vested options, repriceable options, purchased options, reload options, and indexed options. With reasonable parameter values, four options have lower value than a traditional option when granted, and large differences in value are evident across the types. Holding option value constant, five options create stronger incentives than traditional options to increase stock price, five create stronger incentives to increase risk, and three create stronger incentives to reduce dividend yield. Changing various option-specific parameters can produce large changes in incentive strengths. (C) 2000 Elsevier Science S.A. All rights reserved. JEL classification: J33; G13.