exogenous risk and delegation. That is, we show that only if exogenous risk is sufficiently large, the risk-neutral principal … may prefer to delegate authority over decisions to the risk-averse agent. Intuitively, for incentive reasons, the … principal may optimally want to allow the agent to reduce his risk exposure. Nevertheless, even endogenous risk may be higher …

Consider an agent who can costlessly add mean-preserving noise to his output. To deter such risk-taking, the principal … optimally offers a contract that makes the agent's utility concave in output. If the agent is risk-neutral and protected by … limited liability, this concavity constraint binds and so linear contracts maximize profit. If the agent is risk averse, the …

, oftentimes contract forms are chosen that do not fit participant's (owners', contractors') competences and risk capabilities. In … contractual risk allocation depends on the specific MIPP situation - to be understood by a thorough analysis of the owner …

, we study the implications of the interaction between incentive compatibility and participation constraints for risk …

This study analyzed the principal-agent problem, in which the agent performs risk management tasks, and considered the …

that one party is risk neutral while the other is risk averse. This paper describes a real-world contract that is widely … that leads to sharing. The explanation that fits the facts better is simply that distributors and exhibitors are both risk … averse. The analysis suggests that two-sided risk aversion is important in determining contracts. …

Influenced by their compensation plans, CEOs make their own luck through decisions that affect future firm risk. After … adopting a relative performance evaluation (RPE) plan, total and idiosyncratic risk are higher, and the correlation between …) plans. Plans including accounting-based performance metrics and/or cash payouts have weaker risk-related incentives. The …

We provide evidence that CEO equity incentives, especially stock options, influence stock liquidity risk via … disclosure policy. Contributing to the literature on CEO risk-taking, we document a positive association between CEO options and … future systematic stock liquidity risk. Controlling for endogeneity, we show that information disclosure quality is an …