| Author: | Arya, A. Mittendorf, B. |
| Title: | Offering stock options to gauge managerial talent |
| Journal: | Journal of Accounting & Economics
2005 : DEC, VOL. 40:1-3, p. 189-210 |
| Index terms: | compensation executive remuneration management stock options |
| Language: | eng |
| Abstract: | This article aims to prove that besides the normal reasons for the use of stock options such as the motivation and retention of employees, stock options also prove efficient in matching managerial pay to ability. According to the author, since both the likelihood of option exercise and company value in the event of exercise are tied to managerial ability, only a competent manager would take such a gamble. |
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