This paper reviews the theoretical and empirical literature on executive compensation. We
start by presenting data on the level of CEO and other top executive pay over time and …

We argue that managerial overconfidence can account for corporate investment distortions.
Overconfident managers overestimate the returns to their investment projects and view …

Does CEO overconfidence help to explain merger decisions? Overconfident CEOs over-
estimate their ability to generate returns. As a result, they overpay for target companies and …

This paper provides an overview of the main theoretical elements and empirical
underpinnings of a “managerial power” approach to executive compensation. Under this …

As this book clearly demonstrates, structural flaws in corporate governance have produced
widespread distortions in executive pay. Pay without Performance presents a disconcerting …

The way in which securities are traded is very different from the idealized picture of a
frictionless and self-equilibrating market offered by the typical finance textbook. Market …

We employ a certainty-equivalence framework to analyze the cost, value and
pay/performance sensitivity of non-tradable options held by undiversified, risk-averse …

Stock and option compensation and the level of managerial equity incentives are aspects of
corporate governance that are especially controversial to shareholders, institutional activists …

The benefits of stock options are often not large enough to offset the inefficiency implied by
the large divergence between the cost of options to companies and the value of options to …

Using a comprehensive hedge fund database, we examine the role of managerial incentives
and discretion in hedge fund performance. Hedge funds with greater managerial incentives …