Traditionally, researchers have had difficulty testing the relationship between the degree of risk or uncertainty in workers' environments and incentive pay. The authors employ Prendergast's (2002) theory that incorporates the delegation of worker authority into the principal-agent model to...

This paper shows that portfolio constraints have important implications for management compensation and performance evaluation. Concretely, in the presence of portfolio constraints, allowing for benchmarking can be beneficial. Benchmark design arises as an alternative effort inducement mechanism...

This paper shows that portfolio constraints have important implications for management compensation and performance evaluation. In particular, in the presence of portfolio constraints, allowing for benchmarking can be bene cial. Benchmark design arises as an alternative effort inducement...

We run a field experiment to investigate whether competing in rank-order tournaments with different prize spreads affects individual performance. Our experiment involved students from an Italian University who took an intermediate exam in which one part was awarded on the basis of their relative...

We run a field experiment to investigate whether competing in rank-order tournaments with different prize spreads affects individual performance. Our experiment involved students from an Italian University who took an intermediate exam in which one part was awarded on the basis of their relative...

In this paper, we develop and test a model of optimal incentive compensation that incorporates consideration for the role of both competition and cooperation among the firm's top executives. Our model highlights the effects of firm risk on the relative importance of cooperative versus...

This paper shows that portfolio constraints have important implications for management compensation and performance evaluation. In particular, in the presence of portfolio constraints, allowing for benchmarking can be beneficial. Benchmark design arises as an alternative effort inducement...

Contracts are examined when outcomes depend on managers' choices as well as efforts. As the cost of effort shrinks relative to payoffs, the optimal contract converges to a linear payoff if the control space of the agent has full dimensionality, but not otherwise. Thus, when the agent can trade...

Most organizations employ collaborative teams to manage innovation projects. While the use of collaborative innovation teams is a good starting point, an organization’s ability to innovate can be enhanced by managing risk-taking behavior through monetary incentive schemes and through an...

Many challenges face the strategic leader who must deal with both the need for continuity and the need for change. Strategic leadership sets the directions, meaning, purposes, and goals of the organization. A long-term perspective is required along with many other competencies. Examples are...