Optimal Managerial Incentive Contracts and the Value of Corporate Insurance
研究当管理者能选择努力水平时，管理层的对冲行为如何影响股东财富。结果表明，股东偏好管理者对冲可观察的非系统风险，因为这能激励管理者提高生产率。
This paper investigates the impact of managerial hedging on shareholder wealth when managers are able to choose the level of effort they expend in managing firms' invest? ments. We demonstrate that shareholders will prefer managers to hedge observable unsys? tematic risks because they expect that this will induce managers to be more productive. We begin with the case where the risk being hedged is independent of managerial effort. In this case, we show that if shareholders are able to adjust incentive contracts either in anticipation of hedging or after observing hedging, but before managers expend effort, then they will benefit from that hedging. When the insurable risk is also dependent on managerial effort, then we have what we term an embedded moral hazard problem. In this case, the optimal contract may entail either over or under insurance by the manager, relative to that preferred by shareholders.