This paper investigates managerial discretion in compensation decisions in a team (i.e., joint production) setting. Specifically, we investigate the conditions under which managers tasked with allocating a discretionary bonus pool are willing to incur a personal cost to obtain ex post...

Questionnaire responses reported by Luft and Libby (1997) reveal that transfer price negotiators expect fairness-based price concessions that moderate the influence of an outside market price when the outside market price strongly favors one of the parties. We examine whether these expectations...