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The Disposition Effect in the Lab
Vlcek, Martin; Wang, Mei - Institut für Schweizerisches Bankwesen <Zürich> - 2007
We conduct controlled experiments in order to analyze individual trading behavior. Our results suggest that investors measure their gains relative to their initial wealth, and that this reference point together with past stock price changes determine the portfolio choices. Subjects choose a...
Persistent link: https://www.econbiz.de/10005858051
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Making Prospect Theory Fit for Finance
De Giorgi, Enrico; Hens, Thorsten - Institut für Schweizerisches Bankwesen <Zürich> - 2006
The prospect theory of Kahneman and Tversky (1979) and the cumulative prospect theory of Tversky and Kahneman (1992) are descriptive models for decision making that summarize several violations of the expected utility theory. This paper gives a survey of applications of prospect theory to the...
Persistent link: https://www.econbiz.de/10005858528
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Executive Compensation and Specific Knowledge
Morellec, Erwan; Niu, Jijun - Institut für Schweizerisches Bankwesen <Zürich> - 2005
This paper presents a model of executive compensation in which the executive is risk averse and has specific knowledge … compensation. Notably, we find that relative performance evaluation is optimal only if the quality of specific knowledge is low. We …
Persistent link: https://www.econbiz.de/10005858765
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The Executive Turnover Risk Premium
Peters, Florian S.; Wagner, Alexander F. - Institut für Schweizerisches Bankwesen <Zürich> - 2009
CEO compensation has increased substantially over the past 15 years, but so has forcedturnover. Motivated by this …, on average, associated with about 4% more in terms of total compensation.[...] …
Persistent link: https://www.econbiz.de/10005868976