How Does Product Market Competition Shape Incentive Contracts?
利用1996年英镑升值作为准自然实验，研究产品市场竞争增强如何提高CEO、高管和员工的薪酬绩效敏感性，尤其对高管影响更显著。
This paper studies the effect of product market competition on the explicit compensation packages that firms offer to their CEOs, executives and workers. We use a large sample of both traded and nontraded UK firms and exploit a quasi-natural experiment associated to an increase in competition. The sudden appreciation of the pound in 1996 implied different changes in competition for sectors with different degrees of openness. Our difference in differences estimates show that a higher level of product market competition increases the performance pay sensitivity of compensation schemes, in particular for executives.