|
Archive@NYU >
Stern School of Business >
Finance Working Papers >
Please use this identifier to cite or link to this item:
http://hdl.handle.net/2451/26403
|
| Title: | Pay Me Later: Inside Debt and Its Role in Managerial Compensation |
| Authors: | Sundaram, Rangarajan K.
Yermack, David L. |
| Issue Date: | May-2007 |
| Series/Report no.: | FIN-05-002 |
| Abstract: | Many companies pay their executives using inside debt, such as pensions
and deferred compensation. Though these instruments are widely used,
their valuation and incentive effects for managers have been almost
entirely overlooked by prior research. CEO compensation in most firms
exhibits a balance between debt and equity based incentives, and the
balance systematically shifts away from equity and toward debt as CEOs
grow older. CEOs with high debt-based incentives manage their firms
conservatively to reduce default risk. Pension plan compensation
strongly influences patterns of CEO turnover and CEO cash compensation. |
| URI: | http://hdl.handle.net/2451/26403 |
| Appears in Collections: | Finance Working Papers
|
All items in Faculty Digital Archive are protected by copyright, with all rights reserved.
|
