Immordino, Giovanni; Pagano, Marco - Centro Studi di Economia e Finanza (CSEF) - 2008
sensitivity of managerial pay, taking into account external corporate governance and auditing regulation. For given managerial pay …, it is optimal to rely on auditing when external governance is in an intermediate range. When both auditing and managerial … incentive pay are used, worse external governance must be balanced by heavier reliance on both of these incentive mechanisms. In …