search query: @author McConaughy, D. L. / total: 1
reference: 1 / 1
« previous | next »
| Author: | McConaughy, D. L. Mishra, C. S. |
| Title: | Debt, performance-based incentives and firm performance |
| Journal: | Financial Management
1996 : SUMMER, VOL. 25:2, p. 37-51 |
| Index terms: | COMPANY PERFORMANCE DEBT SHARE PRICES |
| Language: | eng |
| Abstract: | We identify conditions of prior performance and pay-performance sensitivity under which an increase in incentives is associated with improved performance. We find that increasing sensitivity increases risk-adjusted performance in firms with poor prior performance, but has little impact on high-performance firms. We also observe that firms choose higher pay-performance sensitivity when the probability of wealth transfers to bondholders is high. Pay-performance sensitivity to stock prices is important. If carefully implemented under the appropriate conditions, it can provide effective incentives for improving firm performance. |
« previous | next »
SCIMA