Bonus Taxes and International Competition for Bank Managers

Daniel Gietl and Andreas Haufler

VfS Annual Conference 2016 (Augsburg): Demographic Change from Verein für Socialpolitik / German Economic Association

Abstract: This paper analyzes the competition in bonus taxation when banks compensate their managers by means of incentive pay and bankers are internationally mobile. Bonus taxes make incentive pay more costly for national banks and lead to an outflow of managers, lower effort and less risk-taking in equilibrium. The international competition in bonus taxes may feature a `race to the bottom', or a `race to the top', depending on whether bankers exert a positive or a negative fiscal value on their home government. The latter can arise when governments bail out banks in the case of default, and bankers take excessive risks as a result of incentive pay.

JEL-codes: G28 H20 H87 (search for similar items in EconPapers)
Date: 2016
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://www.econstor.eu/bitstream/10419/145615/1/VfS_2016_pid_6515.pdf (application/pdf)

Related works:
Journal Article: Bonus taxes and international competition for bank managers (2018)
Working Paper: Bonus Taxes and International Competition for Bank Managers (2017)
Working Paper: Bonus Taxes and International Competition for Bank Managers (2017)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:zbw:vfsc16:145615

Access Statistics for this paper

More papers in VfS Annual Conference 2016 (Augsburg): Demographic Change from Verein für Socialpolitik / German Economic Association Contact information at EDIRC.
Bibliographic data for series maintained by ZBW - Leibniz Information Centre for Economics ().