相对业绩与投资组合思想在期权激励契约设计中的应用

传统股票期权激励契约以股票价格来度量经理人的业绩,但股票价格实际上受到经理人不可控因素(系统风险)的影响,从而导致用股票价格来衡量经理人业绩时会出现反向激励现象,错误惩罚有能力的经理人或慷慨奖励无能的经理人。针对传统股票期权激励契约的缺陷,一些学者把期权激励契约的执行价格和一些指数相联系起来,消除了部分市场水平噪音对期权激励契约的影响。但这种绝对指数股票期权也没有改变指数期权激励契约的结构性缺陷,即不能完全消除市场和行业噪音对期权激励契约的影响。因此,本文借鉴相对业绩和投资组合思想,重新对股票期权的执行价格进行设计,即改变期权到期时权益结构或把执行价格设计成基准绩效投资组合形式,从而达到完全消除市场和行业噪音对期权激励契约的影响,提高期权报酬契约的绩效。     

On the Use of Incentive Pay in Chinese State‐owned Enterprises: The Role of Hierarchy

Abstract. This paper looks at the wage system in Chinese state‐owned enterprises (SOEs) during the 1980s. While wages remained compressed, there is evidence for the use of incentive mechanisms. Wages were quite sensitive to firm performance, especially at higher levels of the hierarchy. One of the reform measures — the Internal Salary System, a system of intra‐firm contracts — has contributed significantly to this sensitivity. There is also some direct evidence that it enhanced the effectiveness of the bonus system, and that it helped to increase productivity. This goes towards explaining how the Chinese bonus system was able to overcome the free‐rider problems typical of team compensation.     

Measurement Error and Incentive Pay

Abstract. We will analyse the optimal incentive scheme when the risk‐neutral principal contracts with many risk‐averse agents. Each agent produces an individual contribution which jointly form a total output. Agents’ efforts are unobservable and the principal cannot observe individual outputs without an error. Neither the observed individual output of an agent nor the observed total output of the whole team are then sufficient statistics for the actual individual output in the sense of Blackwell. We show that the mixed contract of the pure piece‐rate contract and of the pure team contract then dominates the pure contracts from the principal's point of view.     

信息不对称性下的利益冲突与激励贷款合同

本文首先实证调查和研究了我国银行等金融机构面临的高度信息不对称及由此产生的贷款风险;接着从理论和实务的角度研究了不对称信息下的利益冲突,以及银行为保护自己的利益,应如何设计具有激励特征的贷款合同以降低贷款过程中的风险,并达成各方的利益平衡。     

Inventory‐Related Compensation in Decentralized Organizations

We consider a principal agent problem in a decentralized organization. The agent holds private precontracting information with respect to an uncertain demand in a single period setting. Being head of a profit center, his only task is to determine the optimal order quantity. We show that using a profit share as the only performance measure to incentivize the agent creates agency costs. In fact, offering a menu of profit‐sharing contracts to the agent to pick from, requires rent payments to motivate the agent to always choose the desired contract. This result still holds if a fixed payment is added. Using an inventory‐related component as a third measure, however, allows one to solve the agency problem and to achieve first best outcomes. Precisely, each contract needs to specify a bonus or a penalty conditioned on the inventory level at the end of the selling season combined with a profit share and a fixed pay. The paper not only demonstrates that first best can be achieved in the described setting, it also provides a theoretical explanation for the observed practice of using inventory‐related compensation elements, such as service‐level agreements, in organizations.     

Self-Solicited Feedback: Effects of Hourly Pay and Individual Monetary Incentive Pay

The frequency of feedback solicitation under hourly pay and individual monetary incentive pay conditions was examined. A between-subjects design was used with 30 college students in the two groups. Participants attended three experimental sessions and entered the cash value of simulated bank checks presented on a computer screen. Performance was higher for individuals who were paid incentives; however, participants who were paid incentives did not self-solicit feedback more than those who were paid hourly. Rather, participants in both groups solicited feedback quite frequently. Additionally, performance was not related to feedback solicitation. These results suggest that the incentives did not make feedback more reinforcing even though the incentives were functional rewards and the feedback was correlated with the amount of pay earned: the better the feedback, the more pay participants earned. The results also support the position that it may be necessary to pair objective feedback with an evaluative component to enhance performance.     

Conflict of values— the central strategy problem

There is growing evidence that the central strategy question for business is no longer ‘what business are you in?’ but‘why are you in business?’ The traditional answers to this question—‘to make profits’, ‘to grow’ and ‘to give an adequate return to the shareholder’, are all being questioned. In their place others are being suggested—‘to provide satisfying jobs’, ‘to help solve social problems’, ‘to assist in urban and regional development’.In this article, Bernard Taylor suggests that the conflict between business goals and social goals has become the central strategy problem. Business enterprises like other organizations tend to develop their own distinctive sub-cultures with their own value systems which may differ markedly from the values accepted in society generally. The more effective the selection, training and reward systems, the more these business values will be reinforced.But this can lead to difficulties when society begins to reject business values in favour of other social goals; particularly at a time when the power and autonomy of management is being challenged and Corporate Planning is being transformed from an internal dialogue between managers at headquarters and managers in divisions into an open debate involving public servants, employees and self-appointed representatives of community interests.     

Effects of Hourly,Low-Incentive,and High-Incentive Pay on Simulated Work Productivity: Initial Findings With a New Laboratory Method

The failures of previous studies to demonstrate productivity differences across different percentages of incentive pay may be partially due to insufficient simulation fidelity. The present study compared the effects of different percentages of incentive pay using a more advanced simulation method. Three payment methods were tested: hourly, low-incentive, and high-incentive (0%, 10%, and 100%) pay. Four participants performed a simulated work task for 30 6-hr sessions. Productivity under the 100% incentive condition was consistently higher than under the 10% condition for all participants. Productivity under the 10% condition was higher than under the 0% condition for two participants. Results suggest that different percentages of incentive pay may in fact produce productivity differences under more realistic simulated work conditions.     

Getting What You Pay For—Strategic Process Improvement Compensation and Profitability Impact

Profit‐maximizing firm owners who incentivize their managers with a bonus for process improvement create an intentional misalignment of their own objective and management attention. From the viewpoint of a single firm, such a local misalignment can never be profitable, but in this study we take a wider strategic perspective by investigating cost‐reducing process improvements of two firms competing in a Cournot market. We find that the use of a process improvement bonus (by firm A) can be profitable, by affecting the competitor's decision making. Informed about the reward structure at firm A, which provides an incentive for process improvement and thereby for increased production at that firm, the manager of the competing firm (B) is inclined to produce less if the owner of firm B only rewards profit. This leads to a higher profit for firm A. However, we also show that firm B's best strategy is to also offer a process improvement bonus, even if that firm is a cost laggard (with higher costs for process improvement), and that this leads to reduced profit for both firms in many situations unless one of them is sufficiently superior in its ability to improve processes. These results are robust for uncertain process improvement outcomes, multidimensional process improvement decisions, and information asymmetry in the owner–manager relationship.     

Regional Headquarter’s Dual Agency Role: Micro‐political Strategies of Alignment and Self‐interest

The increased research focus on the networked perspective of the multinational enterprise (MNE) reflects a greater delegation of responsibility from corporate headquarters (CHQ) to subsidiary and intermediary units such as regional headquarters (RHQ). This shift has increased the intensity of political interactions between key actors within the MNE. Despite the recent rise in studies on the micro‐political perspective of the MNE to date, little empirical work has explored this issue in the context of the CHQ–RHQ relationship. Drawing insights from agency theory and micro‐politics, the authors focus on the context in which RHQs develop micro‐political strategies in order to manage the flow and exchange of knowledge with CHQ. They show how RHQ may exhibit a ‘dual agency’ role when dealing with CHQ, in that it is characterized as a principal and agent, each requiring different micro‐political knowledge strategies. As a principal, RHQ will develop micro‐political knowledge strategies to increase alignment with CHQ. As an agent, RHQ develops micro‐political knowledge strategies to pursue its self‐interests. Having identified different RHQ agency roles, the authors develop a conceptual model that outlines how alignment and self‐interest‐seeking behaviours from RHQ are manifest through different micro‐political knowledge strategies in its agency relationship with CHQ.     

The Effects of Top Management Team Pay and Firm Internationalization on MNC Performance

We examine relationships among top management team (TMT) compensation, a firm’s degree of internationalization (DOI), and its subsequent levels of market and accounting performance. Consistent with our contingency view of information-processing theory, we find that non-CEO total pay and the use of long-term incentive pay are positively associated with subsequent performance, whereas the CEO-TMT total pay gap has negative effects on firm performance. CEO pay has no relationship with performance and TMT pay effects are much stronger in MNCs with high DOI.     

中国管理环境:暧昧文化因子、管理真实形态与情境嵌入机理

基于中国文化复杂含义的"关系"本位伦理的"意言行"错位结构,所形成的思维模式和行为方式具有典型的"暧昧"特征,暧昧文化与暧昧法则控制了组织所谓"知行一致"和"表里如一"的表达方式,支配了非正式组织的利益取向和私下行为。基于中国管理情境的实践所提炼的暧昧管理理论十分有价值和必要。这种理论基于跨文化、跨情境"关系"的差别与联系,建立信任关系与暧昧关系交叉相容的均衡结构;在主体集聚因素和环境集聚因素的耦合过程中,实现普适性管理理论架构的优先嵌入和差同性知识系统的能动根植。     

考虑保险机构参与的重大工程风险管理激励模型

重大工程建设过程往往面临着巨大的风险暴露，保险是重要的风险处置手段，承接保险合同的保险机构和业主一起成为风险损失的承担主体。考虑到保险机构拥有极强参与现场风险管理的动能，本文基于委托代理理论构建了保险机构介入下业主与承包商的激励模型，分别讨论了共同代理和独家代理两种模式下各方的策略与收益。研究结果表明：共同代理模式下，保险机构实现了主动风险管理，业主和保险机构的收益均得以提高，业主愿意提供比独家代理模式更高的激励系数；承包商在共同代理模式下将采取更为积极的风险管理努力，同时其机会主义行为得到了抑制；业主的最优激励系数受项目特征、承包商自身因素以及外界环境的不确定性共同作用。     

Fairness and Contract Design

We show experimentally that fairness concerns may have a decisive impact on the actual and optimal choice of contracts in a moral hazard context. Bonus contracts that offer a voluntary and unenforceable bonus for satisfactory performance provide powerful incentives and are superior to explicit incentive contracts when there are some fair‐minded players, but trust contracts that pay a generous wage up front are less efficient than incentive contracts. The principals understand this and predominantly choose the bonus contracts. These results are consistent with recently developed theories of fairness, which offer important new insights into the interaction of contract choices, fairness, and incentives.     

What guides subjective performance evaluation: Incentive alignment or norm enforcement?

This paper investigates the objectives guiding a superior’s subjective evaluation of subordinate performance. In a laboratory experiment, we implement a team production setting under uncertainty, where subordinates contribute to the organization’s output by choosing effort levels, but individual contributions are subject to random shocks. After observing joint output, the superior can invest into additional (perfect or imperfect) information about effort levels. We test two competing hypotheses about objectives guiding a superior’s subjective performance evaluation. The incentive alignment hypothesis states that the superior is guided by the objective to establish financial incentives that align a subordinate’s preferences with the organization’s goals such that it is in the subordinate’s self-interest to provide effort. In contrast, the norm enforcement hypothesis states that the superior has a focus on subordinate behavior and wants to enforce the norm of cooperation by rewarding high and punishing low effort. Our results reject the incentive alignment hypothesis and provide support for the norm enforcement hypothesis.     

The Role of Contracts on Quality and Returns to Quality in Offshore Software Development Outsourcing

In this study, we examine how the different incentive structures inherent in two primary contract types—time and materials (T&M) and fixed price (FP)—influence the quality provided by the vendor in the software development outsourcing industry. We argue that the incentive structure of FP contracts motivates a vendor to be more efficient in the software development process, which results in higher quality as compared to projects executed under a T&M contract. We thus argue that vendors consistently staff FP projects with better trained personnel because they face the most risk on these contracts, resulting in better outcomes on these projects. We extend our analysis to propose that providing higher quality is associated with higher profit margins for the vendor only for FP contracts. We develop and test these hypotheses on data collected from 100 software projects completed by a leading Indian offshore vendor. The results provide strong support for our fundamental thesis that the drivers of and returns to quality vary by contract type. We discuss the implications of our research for both researchers and practitioners.     

Human capital and agency effects on CEO compensation of IPO biopharmaceutical firms and the market’s response

This paper examines the determinants of base pay and total incentive compensation packages of CEOs of biopharmaceutical firms that have recently gone public, and whether human capital and agency factors affect the market’s response to the initial public offering. We find that in terms of net proceeds, the IPO market appears to reward the firms that have founder-CEOs and CEOs with higher incentive compensation. CEOs with prior venture capital experience are associated with receiving higher incentive compensation, while CEOs with a greater ownership interest in the firm receive lower incentive compensation but higher salaries. CEOs of firms with a greater percentage of insiders are associated with lower salaries. The results should add to our understanding related to human capital and agency theories, as well as help firms and investors better understand and structure CEO compensation.     

Selection system orientations as an explanation for the differences between dual leaders of the same organization in their perception of organizational performance

We investigate to what extent individual managers operating in a dual leadership structure have different perceptions of how well his/her organization is performing. Using selection system theory we develop hypotheses on the relationships between a leader’s selection system orientation and his/her perception of performance along multiple dimensions: market performance, expert performance and peer performance. The hypotheses are tested using dyadic data from 59 organizations in the performing arts led by two—hierarchically equivalent—managers. Our results show that dual leaders’ differences in terms of market orientation and expert orientation relate positively to perceived performance differences along the same dimensions. This relationship is not found with respect to peer selection orientation. Generally, the relationship between orientation differences and perceived performance differences is stronger if the process of interpreting signals to construct a perception of organizational performance leaves more room for equivocality and uncertainty.     

Hedging and accounting-based RPE contracts for powerful CEOs

Several firms prohibit their CEOs from trading in the stock of peer firms. This is puzzling since hedging by the CEO through private trading in the capital market can reduce the CEO’s exposure to systematic compensation risk. When the CEO’s incentive contract comprises relative performance evaluation, we find that the firm might want to disallow private hedging even though there are no technological interdependencies or strategic interactions to peer firms. In the analysis, we highlight two frequently observed characteristics of incentive contracts. First, the use of accounting benchmarks is widespread in compensation contracts for CEOs. Second, empirical and anecdotal evidence suggests that powerful CEOs have influence on the process of designing their own compensation. We find that in the presence of a powerful CEO, the firm can benefit from disallowing private hedging. In particular, the firm’s decision to allow or to disallow private hedging depends on the characteristics of the accounting benchmarks and the characteristics of the peer firms.     

Contractual relations and organizational structure in franchising

In this paper, we employ a new dataset based on a sample of 123 franchise systems originating from Germany to empirically test hypotheses stemming from agency theory and capital scarcity considerations on the contractual relations and the organizational structure in franchising. We include proxies for the franchisor’s capital scarcity as well as for moral hazard on the franchisee’s and the franchisor’s side. Furthermore, we distinguish between initial and ongoing franchisor support. Our results indicate that agency models based on double moral hazard do explain the design of franchise contracts and the organizational structure in terms of the proportion of franchised outlets. We find that the incentive component of the franchise contract (the royalty rate) is not influenced by moral hazard on the franchisee’s side, but rather by moral hazard on the franchisor’s side. Furthermore, the proportion franchised is strongly influenced by moral hazard on the franchisee’s side. Hence, after providing incentives to outlet managers by turning them into franchisees, thereby granting them residual claimancy, the royalty rate mainly serves to ensure ongoing franchisor input. The franchisor’s capital scarcity influences the fixed fee in franchise contracts and the proportion of franchised outlets, thus supporting standard capital scarcity arguments.