Option Compensation and Industry Competition
Compensation policy has become one of the most important ingredients of corporate governance. In this paper we take a new look at the issue, by contrasting the use of options with that of pure stock. We do this by integrating the repricing or resetting aspect of options with that of industrial structure. We show that industry competition may play an important role in dictating which form of compensation is optimal. When aggressive competition for key professional staff is an issue, the flexibility of options may actually become a disadvantage and therefore pure stock compensation may survive as an equilibrium. Thus compensation trends can be reconciled with trends in the nature of the competitive environment.
Neal M. Stoughton Kit PongWong
University of Calgary The University of Hong Kong
国际会议
成都
英文
1-39
2007-07-09（万方平台首次上网日期，不代表论文的发表时间）