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| Author: | Carter, M.E. Lynch, L.J. |
| Title: | The effect of stock option repricing on employee turnover |
| Journal: | Journal of Accounting & Economics
2004 : FEB, VOL. 37:1, p. 91-112 |
| Index terms: | Management Executive remuneration Pay Stock markets Options Pricing Change Employees Turnover USA |
| Language: | eng |
| Abstract: | This paper examines whether repricing underwater stock options (hereafter as: u-s-o.) reduces executive and overall employee turnover using a sample of firms that reprice stock options in 1998 and a sample of firms with u-s-o. that choose not to reprice. Little evidence is found that repricing affects executive turnover. However, using forfeited stock options to proxy for overall employee turnover, it is found that 1999 employee turnover is negatively related to the 1998 repricing, suggesting that repricing helps prevent turnover due to u-s-o. There is no evidence found that the relation btw. turnover and repricing differs between high technology and non-high technology firms. |
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