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Researcher | Institution | Original publication | Reading recommendations | Beyond | CitationIn the laboratory experiment presented in this video, experimental CEOs were compensated either through stock options or restricted company stock. It shows that stock options induce excessive risk-taking in some cases and that company performance is generally better under compensation through restricted company stock. As FERDINAND M. VIEIDER points out, the main determinant of risk-taking under compensation through stock options was found to be the personal asset position of the experimental CEO.
DOI:
https://doi.org/10.21036/LTPUB10099
Institution
University of Reading
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Original publication
Risk Taking of Executives under Different Incentive Contracts: Experimental Evidence
Journal of Economic Behavior and Organization
Published in 2013
Reading recommendations
A Tractable Method to Measure Utility and Loss Aversion Under Prospect Theory
Journal of Risk and Uncertainty
Published in 2008
Prospect Theory and the Risk-Return Association: An Empirical Examination in 85 Industries
Journal of Economic Behavior & Organization
Published in 1990
Prospect Theory: An Analysis of Decision Under Risk
Econometrica: Journal of the Econometric Society
Published in 1979
Advances in Prospect Theory: Cumulative Representation of Uncertainty
Journal of Risk and Uncertainty
Published in 1992
Curvature of the Probability Weighting Function
Management Science
Published in 1996
Beyond
A Ground-breaking Scientific Revolution
An Alarming Challenge for Society
If I Had a Second Life
A Personal Reading Recommendation