{"product_id":"executive-compensation-and-firm-performance-von-shu-tian-und-peter-l-swan","title":"EXECUTIVE COMPENSATION AND FIRM PERFORMANCE","description":"\u003cp\u003eThis study considers the determination of the ex  ante pay-performance relationship. A single-period  partial equilibrium model is used to show that the  executive income can be expressed as a function of  the firm''s return expressed in dollar terms. The  executive income is jointly determined by the  opening firm size and current return, which function  as a managerial talent proxy and self-selection  mechanism respectively. Comparing to Jensen and  Murphy (1990) wealth-based Pay-Performance  Sensitivity (PPS), this study presents an income- based PPS. The alternative PPS not only overcomes a  misleading misspecification in Jensen and Murphy  (1990), but also corrects Rosen''s (1992) argument  for only including return in the pay performance  relationship. This study finds empirically that both  the opening firm size and stock return play a  significant role in determining executive income.  This study provides supplementary evidence to  Murphy''s (1986) Learning Model. However, shareholder  income may not be an ideal performance measure in  capturing the multi-period pay-performance  relationship.\u003c\/p\u003e\u003cdiv class=\"aw-variant-hidden-subtitle-div\" id=\"aw-variant-subtitle-9783844331943\"\u003e\u003ch3\u003epay-performance relationship revisited\u003c\/h3\u003e\u003c\/div\u003e","brand":"Autorenwelt Shop","offers":[{"title":"Softcover - 9783844331943","offer_id":39495938211933,"sku":"9783844331943","price":49.0,"currency_code":"EUR","in_stock":true}],"thumbnail_url":"\/\/cdn.shopify.com\/s\/files\/1\/0940\/0622\/files\/4a3759e6-23db-464f-a042-d03d1045c3ce.jpg?v=1757740699","url":"https:\/\/shop.autorenwelt.de\/products\/executive-compensation-and-firm-performance-von-shu-tian-und-peter-l-swan","provider":"Autorenwelt Shop","version":"1.0","type":"link"}