The goal of Section I is to show the economic foundations for the form of the distortion function A[dt; κ] in equation (2). This is formalized through Proposition IA3 and Corollary IA4.Section II contains the proof of axiomatic consistency properties of the MAP performance measure (Section...

Reward systems based on balanced scorecards typically connect pay to an index, i.e. a weighted sum of multiple performance measures. We show that such an index contract may indeed be optimal if performance measures are non-verifiable so that the contracting parties must rely on self-enforcement....

Warren Buffett (1984) presents a group of investors with long-term performance records far superior than the market. Applying an array of prominent performance evaluation models, capturing relative, absolute, density based, and utility-based measures, does little to refute the conclusions of...

This study attempts to increase the understanding of how different solutions to build alliance management capability influence alliance performance. We propose that both reliance on the informal accumulation of alliance experience (i.e., tacit alliance management knowledge, AMK) and articulation...

We examine how relative performance evaluation (RPE) affects industry competition--a question relevant for corporate boards interested in incentivizing executives. Using U.S. airline data, we estimate a dynamic game of competition with heterogenous firms in an oligopolistic market with RPE...

We discuss the importance of using proper metrics for measuring the historical performance of tail risk hedging portfolios in particular, and for any strategy with levered payoffs in general. It is our view that simply using historical compounded returns when the payoffs may be multiples of the...

This paper proposes an empirical approach to capture investment horizons. I utilize this method to analyze short-termist investment. It relies on information which is not observable to investors in the period of investment and therefore considers the nature of short-termism as an agency problem....

The major financial objective of a firm is the maximization of its shareholders’ value. All management decisions and approaches should contribute to this objective. Management, though, faces the problem of determining what the effect of its actions would be on maximizing the shareholder’s...

Resource based theory describes, explains and predicts how firms can achieve sustainable competitive advantages through acquisition and control over resources. This study examines the role of Performance Measurement Systems’ (PMS) usage either diagnostically or interactively in further...

In-company training is not a temporary fashion of the last decades but a product of continuous development with the roots tracing back to ancient Egypt, where sons continued the crafting professions of their fathers and learned directly from them the required knowledge and competencies. In the...