| 来源类型 | Discussion paper
|
| 规范类型 | 论文
|
| 来源ID | DP3294
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| DP3294 Commercial Policy Variability, Bindings and Market Access |
| Joseph Francois; Will Martin
|
| 发表日期 | 2002-04-20
|
| 出版年 | 2002
|
| 语种 | 英语
|
| 摘要 | In this Paper we use agency theory to study the active role of the CEO in the formulation of corporate strategy. We allow the agent (CEO) to play a role in defining the parameters of the agency problem, in an incomplete contracting model in which the agent can be rewarded based only on financial performance. Contracts can be renegotiated depending on the proposed strategy. We argue that CEOs will have an incentive to propose difficult, ambitious strategies for change. The principal (the shareholders) can mitigate this by pre-committing to pay high compensation regardless of the manager's chosen strategy, and will prefer to do so in times of change. In a less changeable environment, they will prefer to wait and see what strategy is chosen before setting compensation. In some circumstances, they will also prefer, if possible, to pre-commit never to pay high compensation. |
| 主题 | Financial Economics
|
| 关键词 | Agency theory
Executive compensation
Free-cash-flow theory
Strategic complexity
|
| URL | https://cepr.org/publications/dp3294
|
| 来源智库 | Centre for Economic Policy Research (United Kingdom)
|
| 资源类型 | 智库出版物
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| 条目标识符 | http://119.78.100.153/handle/2XGU8XDN/532323
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推荐引用方式
GB/T 7714 |
Joseph Francois,Will Martin. DP3294 Commercial Policy Variability, Bindings and Market Access. 2002.
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