1 option
The Trouble with Stock Options / Brian J. Hall, Kevin J. Murphy.
- Format:
- Book
- Author/Creator:
- Hall, Brian J.
- Series:
- Working Paper Series (National Bureau of Economic Research) no. w9784.
- NBER working paper series no. w9784
- Language:
- English
- Physical Description:
- 1 online resource: illustrations (black and white);
- Place of Publication:
- Cambridge, Mass. National Bureau of Economic Research 2003.
- Summary:
- The trouble with options is that too many options are granted to too many people. Most options are granted below the top-executive level, and options are often an inefficient way to attract, retain and motivate executives and (especially) lower-level employees. Why, then, are options so prevalent? We discuss several explanations including changes in corporate governance, reporting requirements, taxes, the bull market and managerial rent-seeking. We also offer an alternative hypothesis that we believe explains the over-use of options and several apparent puzzles: boards and managers falsely perceive stock options to be inexpensive because of accounting and cash-flow considerations.
- Notes:
- Print version record
- June 2003.
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