Bonus Payments and Fund Managers? Behaviour: Trans-Atlantic Evidence

Thomas Gehrig, Lukas Menkhoff and Lütje, Torben
Authors registered in the RePEc Author Service: Torben Luetje ()

No 7118, CEPR Discussion Papers from Centre for Economic Policy Research

Abstract: This questionnaire survey of fund managers in the United States, Germany and Switzerland documents a distinctly positive influence of bonus payments on investment behaviour on both sides of the Atlantic. Higher bonus payments are significantly related to higher working effort but not to risk taking. They also seem to induce fund managers to rely more on fundamental information. Findings within regions are confirmed by Trans-Atlantic evidence as US fund managers receive larger bonuses but also show the effects to a higher degree. The effects documented are stronger for relative than for absolute performance assessment.

Keywords: Fund managers; Fundamental information; Incentives (search for similar items in EconPapers)
JEL-codes: G14 G23 (search for similar items in EconPapers)
Date: 2009-01
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Related works:
Journal Article: Bonus Payments and Fund Managers' Behavior: Transatlantic Evidence (2009)
Working Paper: Bonus Payments and Fund Managers' Behavior: Trans-Atlantic Evidence (2008)
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