 Risk, Uncertainty and Time DiscountingAlexander Pepper
Chapter 4 in The Economic Psychology of Incentives, 2015, pp 59-85 from Palgrave Macmillan Abstract: Abstract In parallel with the widely reported inflation in executive pay around the world during the last 20 years, long-term incentives have come to represent an increasingly large proportion of total compensation. Although long-term incentives take many forms, they typically comprise a deferred award of company stock whose vesting is contingent upon the satisfaction of a time condition (e.g., that the holder is still employed by the company on the third anniversary of the date of award) and sometimes also on a financial performance condition (e.g., that the total shareholder return of the employing company outperforms that of comparator companies). In this chapter, I define long-term incentives broadly, to include share-based incentives such as stock options, restricted stock and performance shares, as well as equity-linked cash-based incentives, such as phantom options, and stock appreciation rights. Keywords: Risk Aversion; Risk Index; Prospect Theory; Risk Averse; International Financial Reporting Standard (search for similar items in EconPapers) There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it. Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:pal:palchp:978-1-137-40925-6_4 Ordering information: This item can be ordered from Access Statistics for this chapter More chapters in Palgrave Macmillan Books from Palgrave Macmillan |
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