Disaggregating the agency contract: the effects of monitoring, incentive alignment, and term in office on agent decision making
Article Abstract:
Using a laboratory design, we examined the simple and interactive effects of monitoring and incentive alignment on managerial decisions. Length of term in office was a third independent variable. Results show that incentive alignment was a more powerful mechanism than monitoring for ensuring that agents acted in the interests of owners. An interaction of monitoring, incentive alignment, and term in office revealed that these effects are relatively complicated and deserve further study. Also, incentive alignment had a beneficial effect for the principal for long-term CEOs, even though the tendency to escalate (an effect negative for principals) was greatest for those agents. (Reprinted by permission of the publisher.)
Publication Name: Academy of Management Journal
Subject: Business, general
ISSN: 0001-4273
Year: 1997
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Other people's money: the effects of ownership on compensation strategy and managerial pay
Article Abstract:
This study analyzes the compensation strategy of firms. We examined differences in the pay and incentives of lower-level managers in firms with different levels of management discretion. We found that firms with higher managerial discretion paid compensation premiums through higher salaries, greater bonuses, and more long-term incentives; however, changes in pay were not related to changes in performance, and high-discretion firms did not perform better than other types of firms. (Reprinted by permission of the publisher.)
Publication Name: Academy of Management Journal
Subject: Business, general
ISSN: 0001-4273
Year: 1995
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Market comparison earnings and the bidding-up of executive cash compensation: evidence from the United Kingdom
Article Abstract:
We argue that compensation committees will pay executives at least at the going rate and that deviations from that rate will influence subsequent pay. In a sample of large U.K. companies, we estimated asymmetric responses to pay anomalies explained executive pay. All three of our pay anomaly measures were statistically related to subsequent pay. Moreover, there was significant nonlinear adjustment toward the going rate for underpaid executives. (Reprinted by permission of the publisher.)
Publication Name: Academy of Management Journal
Subject: Business, general
ISSN: 0001-4273
Year: 1998
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