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Article: Option compensation and industry competition

TitleOption compensation and industry competition
Authors
Stoughton, NMWong, KP
Issue Date2009
PublisherSpringer New York LLC. The Journal's web site is located at http://springerlink.metapress.com/openurl.asp?genre=journal&issn=1572-3097
Citation
Review Of Finance, 2009, v. 13 n. 1, p. 147-180 How to Cite?
DOI: http://dx.doi.org/10.1093/rof/rfn001
AbstractCompensation policy has become one of the most important ingredients of corporate governance. In this paper we take a new look at the issue, by contrasting the use of options with that of stock. We do this by integrating the repricing or resetting aspect of options with that of industrial structure. We show that industry competition may play an important role in dictating which form of compensation is optimal. When aggressive competition for key professional staff is an issue, the flexibility of options may actually become a disadvantage and therefore pure stock compensation may survive as an equilibrium. Thus compensation trends may be partly explained by trends in the nature of the competitive environment.
Persistent Identifierhttp://hdl.handle.net/10722/60182
ISSN
1572-3097
2021 Impact Factor: 5.059
2020 SCImago Journal Rankings: 4.933
SSRN
385621
ISI Accession Number ID
WOS:000263835700005
References
References in Scopus

 

DC FieldValueLanguage
dc.contributor.authorStoughton, NMen_HK
dc.contributor.authorWong, KPen_HK
dc.date.accessioned2010-05-31T04:05:23Z-
dc.date.available2010-05-31T04:05:23Z-
dc.date.issued2009en_HK
dc.identifier.citationReview Of Finance, 2009, v. 13 n. 1, p. 147-180en_HK
dc.identifier.issn1572-3097en_HK
dc.identifier.urihttp://hdl.handle.net/10722/60182-
dc.description.abstractCompensation policy has become one of the most important ingredients of corporate governance. In this paper we take a new look at the issue, by contrasting the use of options with that of stock. We do this by integrating the repricing or resetting aspect of options with that of industrial structure. We show that industry competition may play an important role in dictating which form of compensation is optimal. When aggressive competition for key professional staff is an issue, the flexibility of options may actually become a disadvantage and therefore pure stock compensation may survive as an equilibrium. Thus compensation trends may be partly explained by trends in the nature of the competitive environment.en_HK
dc.languageengen_HK
dc.publisherSpringer New York LLC. The Journal's web site is located at http://springerlink.metapress.com/openurl.asp?genre=journal&issn=1572-3097en_HK
dc.relation.ispartofReview of Financeen_HK
dc.rightsThe original publication is available at www.springerlink.com-
dc.titleOption compensation and industry competitionen_HK
dc.typeArticleen_HK
dc.identifier.openurlhttp://library.hku.hk:4550/resserv?sid=HKU:IR&issn=1572-3097&volume=13&spage=147&epage=180&date=2009&atitle=Option+Compensation+and+Industry+Competitionen_HK
dc.identifier.emailWong, KP: kpwongc@hkucc.hku.hken_HK
dc.identifier.authorityWong, KP=rp01112en_HK
dc.description.naturepostprint-
dc.identifier.doi10.1093/rof/rfn001en_HK
dc.identifier.scopuseid_2-s2.0-58449095403en_HK
dc.identifier.hkuros154235en_HK
dc.relation.referenceshttp://www.scopus.com/mlt/select.url?eid=2-s2.0-58449095403&selection=ref&src=s&origin=recordpageen_HK
dc.identifier.volume13en_HK
dc.identifier.issue1en_HK
dc.identifier.spage147en_HK
dc.identifier.epage180en_HK
dc.identifier.eissn1573-692X-
dc.identifier.isiWOS:000263835700005-
dc.publisher.placeUnited Statesen_HK
dc.identifier.ssrn385621-
dc.identifier.scopusauthoridStoughton, NM=6602557245en_HK
dc.identifier.scopusauthoridWong, KP=7404759417en_HK

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