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This paper determines which individual variables actually driveexercise patterns and how employees value their stock options.
Residual income valuation is based on the assumption that the clean surplusrelation holds. As pointed out by Ohlson (2000), among others, the standardclean surplus relation is frequently violated. Moreover, standard residualincome valuation models rest on the implicit assumption that future...
Our study analyzes the consequences of workers' participation in the wage setting process on effort exertion. The experimental design is based on a modified giftexchange game where the degree of workers' involvement in the wage setting process is systematically varied among the workers. The...
Incentives for managers are often provided by offering them performance-based compensation schemes. The efficiency of such monetary compensations, however, depends on several factors, among them the quality of the employed performance measures, the information available for contracting purposes,...
We study optimal incentive contracts for workers who are reciprocal to management attention. When neither worker's effort nor manager's attention can be contracted, a double moral-hazard problem arises, implying that reciprocal workers should be given weak financial incentives. In a...
This paper introduces a new data source available for HRM researchers and personnel economists, the Linked Personnel Panel (LPP). The LPP is a longitudinal and representative employer-employee data set covering establishments in Germany and designed for quantitative empirical HR research. The...
Inspired by a recent observation about an online retail company, this paper explains why a firm may find it optimal to offer an exit bonus to recent hires so as to induce self-selection. We study a double adverse selection problem, in which the principal can neither observe agents’ commitment...
Are monetary and non-monetary incentives used as substitutes in motivating effort? I address this question in a laboratory experiment in which the choice of the job characteristics (i.e., the mission) is part of the compensation package that principals can use to influence the agents' effort....
It's puzzling that most projects fail to complete within the predetermined timeframe given that timing considerations rank among the major goals in project management. We argue that when managers can extract private benefits from working on a project, project delay becomes optimal. We introduce...
Incentives for managers are often provided by offering them performance-based compensation schemes. The efficiency of such monetary compensations, however, depends on several factors, among them the quality of the employed performance measures, the information available for contracting purposes,...