Price versus Non-Price Performance Measures in Optimal CEO Compensation Contracts
实证检验了CEO总薪酬中价格与非价格绩效指标的权重如何随相对方差变化，发现现金薪酬与总薪酬的结果相反，提示现有基于现金薪酬的研究不能支持标准代理理论预测。
We empirically examine standard agency predictions about how performance measures are optimally weighted to provide CEO incentives. Consistent with prior empirical research, we document that the relative weight on price and non-price performance measures in CEO cash pay is a decreasing function of the relative variances. Agency theory speaks to the weights in total compensation (annual total pay and changes in the CEO's equity portfolio value), however, and we document that very little of CEOs' total incentives come from cash pay. We also document that variation in the relative weight on price and non-price performance measures in CEO total compensation is an increasing function of the relative variances. The conflicting results using total compensation indicate that existing findings on cash pay cannot be interpreted as evidence supporting standard agency predictions. Based on our results, we suggest approaches for future research on performance measure use in CEO total compensation.