Economics
STANFORD GRADUATE SCHOOL OF BUSINESS—Stock options have become commonplace additions to compensation packages in recent years. Yet, the experts say stock options are lousy incentive mechanisms for motivating rank-and-file employees at the largest companies to work hard. Consider, for example, an...
STANFORD GRADUATE SCHOOL OF BUSINESS—As more and more people are putting their money into the care of professionals, it's time to ask if the people investing your money are properly motivated—that is, if they are given incentives to make the right decisions when they construct portfolios composed...
STANFORD GRADUATE SCHOOL OF BUSINESS—What do Disney, AT&T, Exxon, and Verizon have in common? Based on economic performance and what they paid their CEOs from 1991-2002, a new academic study argues that all these firms were headed by CEOs who were paid too much.
These firms, say the...
Most decisions about CEO pay are made by a compensation committee of a company's board of directors. Typically, says O'Reilly, the CEO hires a compensation consultant to determine what executives in the company "should" be paid and ma kea presentation to this committee, which almost always...
By Professor Jonathan B. Berk A.P. Giannini Professor of Finance
STANFORD GRADUATE SCHOOL OF BUSINESS — In any financial crisis, it is possible with 20/20 hindsight to identify the specific proximal causes. Armed with this knowledge, legislators are invariably tempted to outlaw specific activities...
STANFORD GRADUATE SCHOOL OF BUSINESS—A plan by global financial regulators to fix the mess created by the misuse of credit default swaps is flawed, says Darrell Duffie, professor of finance at the Stanford Graduate School of Business.
In a preliminary research paper, Duffie, and GSB doctoral...
STANFORD GRADUATE SCHOOL OF BUSINESS—In what will be music to the ears of marketers, the old adage that you get what you pay for really is true when it comes to that most ephemeral of products: bottled wine.
According to researchers at the Stanford Graduate School of Business and the...
STANFORD GRADUATE SCHOOL OF BUSINESS—The March 31, 2004, Financial Accountings Standards Board (FASB)proposal for expensing stock options is reigniting an already heated battle. Companies like AIG, Citigroup, Coca-Cola, General Electric, Randal are already expensing or planning to expense employee...
STANFORD GRADUATE SCHOOL OF BUSINESS—In 1998, the County of Los Angeles set out to create a report card grading the hygiene of all restaurants. Phillip Leslie, associate professor of strategic management at the Stanford Graduate School of Business, saw the new law as an opportunity to study the...
STANFORD GRADUATE SCHOOL OF BUSINESS - The market for real estate loans crashed three years ago and still has not recovered. But another financial market - peer-to-peer lending - has boomed, and was expected to increase to $5.8 billion last year, an increase of nearly 800% since 2007.
Peer-to-peer...