Resource title

A simulation study of managerial compensation

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Resource description

A computational economics model of managerial compensation is presented. Risk-averse managers are simulated, and shown to adopt more risk-taking under the influence of stock options. It is also shown that stock options can both help a new entrant compete in an established market; and can help the incumbent firm fight off competition by promoting new exploration and risk-taking. In the case of the incumbent, the stock options are shown to be most effective when introduced as a response to the arrival of a new entrant, rather than used as a standard part of the compensation package. (author's abstract) ; Series: Working Papers SFB "Adaptive Information Systems and Modelling in Economics and Management Science"

Resource author

Brian Sallans, Alexander Pfister, Georg Dorffner

Resource publisher

Resource publish date

Resource language

en

Resource content type

application/pdf

Resource resource URL

http://epub.wu.ac.at/1462/1/document.pdf

Resource license

Adapt according to the license agreement. Always reference the original source and author.