The Pearl River Delta, one of the main regions of China's export-oriented economy, has benefited from its traditional economic structure for three decades which in turn appeared to hinder further economic development recently. To advance industrial restructuring and upgrading, the governments...

Incentive effects of performance-based compensation schemes for management may be weakened or biased by macroeconomic influences on remuneration. These influences can be seen as reflecting luck from the CEO's perspective. In this chapter we present a model for how to avoid compensating CEO for...