STRATEGIC INCENTIVES FOR MARKET SHARE

Market share objectives are prominent in many industries, especially where man-agers pay much attention to league table rankings. This paper explores the strategicrationale for giving managers incentives based on market share in an oligopoly com-peting in strategic substitutes. Moreover, the paper discusses evidence on executivecompensation practice in the automotive and investment banking industries. Aspredicted by the theory, rms in both industries use explicit contractual incentivesbased on market share. The protability squeeze in the US car industry due toaggressive buyer discount programs can thus be understood as a consequence ofprevailing management incentives....

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Year of publication:	2005-10-01
Authors:	Ritz, Robert A.
Institutions:	University <Oxford> / Department of Economics
Subject:	Marktanteil \| Investment Banking \| Industrie \| industry \| Delegation \| delegation

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Extent:	260096 bytes 28 p. application/pdf
Series:	University of Oxford - Deparment of Economics - Working Paper Series DISCUSSION PAPER SERIES ; Number 248 (2005)
Type of publication:	Book / Working Paper
Language:	English
Classification:	D21 - Firm Behavior ; D43 - Oligopoly and Other Forms of Market Imperfection ; G24 - Investment Banking; Venture Capital; Brokerage ; J33 - Compensation Packages; Payment Methods ; L62 - Automobiles; Other Transportation Equipment ; Management and organisation. Other aspects ; Management of financial services: stock exchange and bank management science (including saving banks) ; Individual Working Papers, Preprints ; No country specification
Source:	USB Cologne (business full texts)

Persistent link: https://www.econbiz.de/10005870185