The role of stock-based compensation and the internal control of the firm
| Project/Area Number |
17530142
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| Research Category |
Grant-in-Aid for Scientific Research (C)
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| Allocation Type | Single-year Grants |
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| Section | 一般 |
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| Research Field |
Economic theory
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| Research Institution | Kyoto University |
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Principal Investigator |
OSANO Hiroshi Kyoto University, Institute of Economic Research, Professor (90152462)
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| Project Period (FY) |
2005 – 2007
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| Project Status |
Completed (Fiscal Year 2007)
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| Budget Amount *help |
¥2,640,000 (Direct Cost: ¥2,400,000、Indirect Cost: ¥240,000)
Fiscal Year 2007: ¥1,040,000 (Direct Cost: ¥800,000、Indirect Cost: ¥240,000)
Fiscal Year 2006: ¥800,000 (Direct Cost: ¥800,000)
Fiscal Year 2005: ¥800,000 (Direct Cost: ¥800,000)
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| Keywords | stock-based compensation / corporate governance / incentive design / 株価連動型報酬 |
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| Research Abstract |
This research considers the role of stock-based compensation-such as stock options and restricted stock granted to employees, and cross-shareholdings or shareholdings made in joint ventures-in mitigating the moral hazard problem that occurs when agents working in teams face the possibility of turnover and must choose a level of effort or investment in their working relationships with the other agents. In cases of both exogenous and endogenous turnover, I formally derive situations in which stock-based compensation is a component of an optimal compensation contract, and in particular, in which stock-based compensation is superior to cash-based compensation such as bonuses and severance payments. In addition, I show that stock-based compensation is not optimal for individual production. The results provide new empirical and practical implications for stock-based compensation from the viewpoint of team incentives and agents' turnover.
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Report
(4 results)
Research Products
(15 results)
