The DOI matches its Crossref record; 34 of the 34 references it cites were found in a registry or an index.
Executive Compensation, Strategic Competition, and Relative Performance Evaluation: Theory and Evidence
Abstract
We examine compensation contracts for managers in imperfectly competitive product markets. We show that strategic interactions among firms can explain the lack of relative performance‐based incentives in which compensation decreases with rival firm performance. The need to soften product market competition generates an optimal compensation contract that places a positive weight on both own and rival performance. Firms in more competitive industries place greater weight on rival firm performance relative to own firm performance. We find empirical evidence of a positive sensitivity of compensation to rival firm performance that is increasing in the degree of competition in the industry.
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Cites
Performance Pay and Top-Management Incentives
Jensen, M. C., & Murphy, K. J. (1990) · Journal of Political Economy · doi:10.1086/261677 · Cited by 5,083
Holmstrom, B. (1982) · The Bell Journal of Economics · doi:10.2307/3003457 · Cited by 4,903
Monopolistic Competition with Outside Goods
Salop, S. C. (1979) · The Bell Journal of Economics · doi:10.2307/3003323 · Cited by 2,975
Aggregation and Linearity in the Provision of Intertemporal Incentives
Holmstrom, B., & Milgrom, P. (1987) · Econometrica · doi:10.2307/1913238 · Cited by 2,859
Efficient Capital Markets, Inefficient Firms: A Model of Myopic Corporate Behavior
Stein, J. C. (1989) · The Quarterly Journal of Economics · doi:10.2307/2937861 · Cited by 2,563
Robust Tests for Heteroscedasticity Based on Regression Quantiles
Koenker, R., & Bassett, G. (1982) · Econometrica · doi:10.2307/1912528 · Cited by 1,629
The Market Mechanism as an Incentive Scheme
Hart, O. D. (1983) · The Bell Journal of Economics · doi:10.2307/3003639 · Cited by 1,499
Are CEOs Really Paid Like Bureaucrats?
Hall, B. J., & Liebman, J. B. (1998) · The Quarterly Journal of Economics · doi:10.1162/003355398555702 · Cited by 1,308
Managerial Incentives and Product Market Competition
Schmidt, K. M. (1997) · The Review of Economic Studies · doi:10.2307/2971709 · Cited by 1,177
The Other Side of the Trade‐Off: The Impact of Risk on Executive Compensation
Aggarwal, R. K., & Samwick, A. A. (1999) · Journal of Political Economy · doi:10.1086/250051 · Cited by 1,037
Self-citation
Cited by
Are CEOs Rewarded for Luck? The Ones Without Principals Are
Bertrand, M., & Mullainathan, S. (2001) · The Quarterly Journal of Economics · doi:10.1162/00335530152466269 · Cited by 1,740
The design and use of performance management systems: an extended framework for analysis
Ferreira, A., & Otley, D. (2009) · Management Accounting Research · doi:10.1016/j.mar.2009.07.003 · Cited by 1,412
Anticompetitive Effects of Common Ownership
AZAR, J., SCHMALZ, M. C., & TECU, I. (2018) · The Journal of Finance · doi:10.1111/jofi.12698 · Cited by 980
“, Aggarwal and Samwick, 1999; Hartzell and Starks, 2003; Matvos and Ostrovsky, 2008; Cronqvist and Fahlenbrach, 2009; Harford, Jenter, and Li, 2011; Kaplan and Minton, 2012; Massa and Žaldokas, 2013; Katz and McIntosh, 2013; Kempf, Manconi, and Spalt, 2013; Schwartz-Ziv and Wermers, 2014). In particular, it is well kn…”
BackgroundInfluentialCompetition, Risk, and Managerial Incentives
Raith, M. (2003) · American Economic Review · doi:10.1257/000282803769206395 · Cited by 734
Managerial Attributes and Executive Compensation
Graham, J. R., Li, S., & Qiu, J. (2012) · Review of Financial Studies · doi:10.1093/rfs/hhr076 · Cited by 549
Metadata
- Authors
- Aggarwal, R. K., & Samwick, A. A.
- Venue
- The Journal of Finance
- Publisher
- Wiley
- Published
- 1999-12
- Volume
- 54
- Issue
- 6
- Pages
- 1999-2043
- ISSN
- 0022-1082 (ISSN-L)
- 1540-6261
- OpenAlex
- W2892275069
- Cited by
- 733
- References
- 34
- FWCI
- 47.57
- Type
- journal article
- Language
- en
- Open access
- closed
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Bibliographic data: Semantic Scholar, OpenAlex, Crossref.
Contains information from the Semantic Scholar Academic Graph Datasets, made available under the ODC Attribution License (ODC-BY 1.0).
Semantic Scholar’s data is described in: Kinney, R., et al. (2023). The Semantic Scholar Open Data Platform. arXiv:2301.10140.
