scholarly journals Only Time Will Tell: A Theory of Deferred Compensation

2020 ◽  
Author(s):  
Florian Hoffmann ◽  
Roman Inderst ◽  
Marcus Opp
Keyword(s):  
Limited Liability ◽  
Optimal Timing ◽  
Deferred Compensation ◽  
Optimal Contracts ◽  
Clear Cut ◽  
Maturity Structure ◽  
Nature Of Information ◽  
Agent Characteristics ◽  
Informative Signals ◽  
Over Time

Abstract This article characterizes optimal compensation contracts in principal-agent settings in which the consequences of the agent’s action are only observed over time. The optimal timing of pay trades off the costs of deferred compensation arising from the agent’s relative impatience and potential consumption smoothing needs against the benefit of exploiting additional informative signals. By capturing this information benefit of deferral in terms of the likelihood ratio dynamics, our characterization covers general signal processes in a unified setting. With bilateral risk neutrality and agent limited liability, optimal contracts are high-powered and stipulate at most two payout dates. If the agent is additionally risk-averse, payouts are contingent on performance exceeding a hurdle that is increasing over time. We obtain clear-cut predictions on how the duration of optimal compensation depends on the nature of information arrival as well as agent characteristics and derive implications for the maturity structure of securities in financial contracting settings.

scholarly journals Optimal contracts with a risk‐taking agent

2020 ◽  
Vol 15 (2) ◽  
pp. 715-761 ◽  
Author(s):  
Daniel Barron ◽  
George Georgiadis ◽  
Jeroen Swinkels
Keyword(s):  
Risk Taking ◽  
Limited Liability ◽  
Risk Averse ◽  
Trade Off ◽  
Optimal Contracts ◽  
Risk Neutral ◽  
Profit Maximizing ◽  
Over Time

Consider an agent who can costlessly add mean‐preserving noise to his output. To deter such risk‐taking, the principal optimally offers a contract that makes the agent's utility concave in output. If the agent is risk‐neutral and protected by limited liability, this concavity constraint binds and so linear contracts maximize profit. If the agent is risk averse, the concavity constraint might bind for some outputs but not others. We characterize the unique profit‐maximizing contract and show how deterring risk‐taking affects the insurance‐incentive trade‐off. Our logic extends to costly risk‐taking and to dynamic settings where the agent can shift output over time.

scholarly journals Why it Pays to Conceal: On the Optimal Timing of Acquiring Verifiable Information

2011 ◽  
Vol 12 (1) ◽  
pp. 100-123 ◽  
Author(s):  
Eberhard Feess ◽  
Markus Walzl ◽  
Michael Schieble
Keyword(s):  
Information Technology ◽  
Moral Hazard ◽  
Adverse Selection ◽  
Limited Liability ◽  
Optimal Timing ◽  
Optimal Contracts ◽  
Additional Information ◽  
Information Rent ◽  
Adverse Selection Problem

Abstract We consider optimal contracts when a principal has two sources to detect bad projects. The first one is an information technology without agency costs (ITP), whereas the second one is the expertise of an agent subject to moral hazard, adverse selection and limited liability (ITA). First, we show that the principal does not necessarily benefit from access to additional information and thereby may prefer to ignore it. Second, we discuss different timings of information release, i.e., a disclosure contract offered to the agent after the principal announced the result of ITP, and a concealment contract where the agent exerts effort before ITP is checked. We find that concealment is superior whenever the quality of ITP is sufficiently low. Then, ITP is almost worthless under a disclosure contract, while it can still be exploited to reduce the agent’s information rent under concealment. If the quality of ITPimproves, disclosure can be superior as it allows to adjust the agent’s effort to the updated expected quality of the project. However, even for a highly informative ITP, concealment can be superior as it mitigates the adverse selection problem.

Part VI Global Approach of State Aid Law—WTO Law and EU Trade Defence Instruments, 2 Anti-subsidy Law and Practice of the European Union

2016 ◽  
Author(s):  
Kreuschitz Viktor ◽  
Nehl Hanns Peter
Keyword(s):  
European Union ◽  
Chinese Government ◽  
The European Union ◽  
Global Approach ◽  
Clear Cut ◽  
The Past ◽  
Export Subsidies ◽  
Very High ◽  
Over Time ◽  
The Eu

This concluding chapter explores EU's anti-subsidy instruments, which are designed to address subsidization by other WTO members. After a hesitant start, the EU since 1995 has progressively used the AS instrument to act against subsidization by third-country governments. While initially focusing on relatively clear-cut export subsidies, over time the EU has more and more also countervailed domestic subsidy programmes. This is clearest in the AS cases initiated against China during the past five years, where the majority of the countervailed programmes have consisted of domestic subsidies. In this context, it is important to note that the findings of specificity reached by the EU in cases concerning China are largely based on the use of facts available, resulting from the imposition of very high burdens of proof on the Chinese government that domestic subsidies in fact are not specific.

Toward an Institutional Theory of Community and Community Associations: a Review

2019 ◽  
Vol 4 (1) ◽  
pp. 1-63 ◽  
Author(s):  
Carl Milofsky
Keyword(s):  
Social Capital ◽  
Institutional Theory ◽  
Urban Sociology ◽  
Limited Liability ◽  
Community Based ◽  
Community Based Organizations ◽  
The Past ◽  
Community Associations ◽  
History Of ◽  
Over Time

AbstractThis article argues the position that the symbolic sense of community is a product of action by associations and larger community-based organizations. It draws on a theory from urban sociology called “the community of limited liability.” In the past this theory, first articulated by Morris Janowitz, has mostly been used to argue that residents living in a local neighborhood feel a sense of identification with that area to the extent that the symbolism of that neighborhood has been developed. This article extends Janowitz’s theory to apply to local associations and their efforts to create activities, movements, and products that encourage residents to expand their sense of symbolic attachment to a place. We argue that this organizational method has long been used by local associations but it has not been recognized as an organizational theory. Because associations have used this approach over time, communities have a historical legacy of organizing and symbol creating efforts by many local associations. Over time they have competed, collaborated, and together developed a collective vision of place. They also have created a local interorganizational field and this field of interacting associations and organizations is dense with what we call associational social capital. Not all communities have this history of associational activity and associational social capital. Where it does exist, the field becomes an institutionalized feature of the community. This is what we mean by an institutional theory of community.

Is Anorexia Nervosa an Obsessive-Compulsive Disorder?

1990 ◽  
Vol 157 (1) ◽  
pp. 1-5 ◽  
Author(s):  
Neil L. Holden
Keyword(s):  
Anorexia Nervosa ◽  
World Health Organization ◽  
Anterior Pituitary ◽  
World Health ◽  
Obsessive Compulsive ◽  
Compulsive Disorder ◽  
Clear Cut ◽  
Icd 10 ◽  
Health Organization ◽  
Over Time

Although anorexia nervosa may vary widely in its severity and outcome, it is usually regarded as an illness in its own right, as patients do not display major changes in the form of the illness over time (Russell, 1970). It readily lends itself to being accorded clear-cut diagnostic criteria (Russell, 1977) and this is reflected in ICD–10 (World Health Organization, 1987). However, the nosological independence of anorexia nervosa has undergone vigorous assault since its classic description by William Gull (1874). For example, the psychological nature of anorexia nervosa was obscured for 30 years by Simmond's (1914) description of anterior pituitary lesions and cachexia, and Kay & Leigh's (1954) influential study of anorexia nervosa concluded with their doubts about its status as a ‘psychiatric entity’.

Ranking of finance journals: a stochastic dominance analysis

2016 ◽  
Vol 42 (4) ◽  
pp. 312-323 ◽  
Author(s):  
Erin H. Kao ◽  
Chuan-Hao Hsu ◽  
Yunlin Lu ◽  
Hung-Gay Fung
Keyword(s):  
Stochastic Dominance ◽  
Convincing Evidence ◽  
Research Quality ◽  
Journal Ranking ◽  
Citation Distribution ◽  
Dynamic Nature ◽  
Content Type ◽  
Clear Cut ◽  
Changes Over Time ◽  
Over Time

Purpose – Prior studies in citation-based journal rankings tend to be static to compare across journals. One journal may be judged better in citations than other journals at some points in time but not at the others. The assumption that the citation distribution is normally distributed and that the citation observations are independent and identically distributed (i.i.d.) may not be appropriate. The paper aims to discuss these issues. Design/methodology/approach – This study uses a stochastic dominance (SD) analysis, which overcomes the dynamic nature of changes in citation over time. The SD method proposed by Linton, Maasoumi, and Whang (hereafter LMW, 2005) does not require the data to be i.i.d. We use the LMW method to compare the relative ranking of 23 finance journals using citations for all articles from them during 1990-2010. Findings – The study indicates that the citation distribution changes over time. Thus a SD analysis is a better approach for a comparison of journal ranking. The findings unambiguously place JF, JFE, RFS, JFQA, and JFI in the top five spots of the finance journal ranking. The “near-top” journals, such as JBF, JCF, and FM, are not clear cut in the SD analysis. Research limitations/implications – The results confirm that ranking for the lower ranked journals may change over time especially, but the top three journals appear to be robust across methods and over time. Originality/value – The results of SD analysis provides more convincing evidence on finance journal ranking and could be useful to rank academic institutions, faculty research quality, and help the authors to decide what to read and which journals are influential.

scholarly journals Bryophyte Conservation in Managed Boreal Landscapes: Fourteen-Year Impacts of Partial Cuts on Epixylic Bryophytes

2021 ◽  
Vol 4 ◽  
Author(s):  
Jeffrey Opoku-Nyame ◽  
Alain Leduc ◽  
Nicole J. Fenton
Keyword(s):  
Species Composition ◽  
Coarse Woody Debris ◽  
Black Spruce ◽  
Woody Debris ◽  
Permanent Plots ◽  
Old Growth ◽  
Clear Cut ◽  
Old Growth Forest ◽  
Old Growth Forests ◽  
Over Time

Clear cut harvest simplifies and eliminates old growth forest structure, negatively impacting biodiversity. Partial cut harvest has been hypothesized (1) to have less impact on biodiversity than clear cut harvest, and (2) to encourage old growth forest structures. Long-term studies are required to test this hypothesis as most studies are conducted soon after harvest. Using epixylic bryophytes as indicators, this study addresses this knowledge gap. Fourteen years after harvest, we examined changes in epixylic bryophyte community composition richness and traits, and their microhabitats (coarse woody debris characteristics and microclimate) along an unharvested, partial cuts and clear cuts harvest treatment in 30 permanent plots established in the boreal black spruce (Picea mariana) forests of northwestern Quebec, Canada. Our results were compared to those of an initial post-harvest study (year 5) and to a chronosequence of old growth forests to examine species changes over time and the similarity of bryophyte communities in partial cut and old growth forests. Coarse woody debris (CWD) volume by decay class varied among harvest treatments with partial cuts and clear cuts recording lower volumes of early decay CWD. The epixylic community was richer in partial cuts than in mature unharvested forests and clear cuts. In addition, species richness and overall abundance doubled in partial and clear cuts between years 5 and 14. Species composition also differed among treatments between years 5 and 14. Furthermore, conditions in partial cut stands supported small, drought sensitive, and old growth confined species that are threatened by conditions in clear cut stands. Lastly, over time, species composition in partial cuts became more similar to old growth forests. Partial cuts reduced harvest impacts by continuing to provide favorable microhabitat conditions that support epixylic bryophytes. Also, partial cut harvest has the potential to encourage old growth species assemblages, which has been a major concern for biodiversity conservation in managed forest landscapes. Our findings support the promotion of partial cut harvest as an effective strategy to achieve species and habitat conservation goals.

2. Corporate personality and limited liability

Company Law ◽  
2020 ◽  
pp. 14-28
Author(s):  
Alan Dignam ◽  
John Lowry
Keyword(s):  
Small Businesses ◽  
Limited Liability ◽  
Company Law ◽  
Historical Background ◽  
The Core ◽  
Corporate Form ◽  
The Subject ◽  
Corporate Personality ◽  
Over Time

Titles in the Core Text series take the reader straight to the heart of the subject, providing focused, concise, and reliable guides for students at all levels. This chapter deals with corporate personality and limited liability, two concepts that form the core of company law. It begins with a short historical background on how the process of corporatisation through charters evolved over time, including the emergence of the use of trust as an instrument to confer many of the privileges of incorporation. It then considers the case Salomon v Salomon & Co (1897) which decided on the legitimacy of small businesses with a corporate form, and offers some other good examples of the consequence of separate personality. The chapter also discusses the rights of members and shareholders with respect to ownership of the corporation, focusing on dispersed shareholdings and close companies.

Considering Build-Later as an Alternative in Major Transit Investment Analyses

1998 ◽  
Vol 1623 (1) ◽  
pp. 179-184 ◽  
Author(s):  
Xuehao Chu ◽  
Steven Polzin
Keyword(s):  
Theoretical Model ◽  
Discount Rate ◽  
Construction Cost ◽  
Necessary Condition ◽  
Optimal Timing ◽  
Infrastructure Projects ◽  
Public Infrastructure ◽  
Net Benefits ◽  
Over Time

How the stream of benefits, discount rate, and other parameters of a major transit project affect its optimal timing are examined. A theoretical model of the timing of public infrastructure projects is used. The model takes into account the net benefits of a project, the variation of benefits with project age and timing of investment, construction cost and its growth, and discount rate. The model is used to examine three questions: Under what conditions is build-later optimal? How do changes in the discount rate and other parameters of an investment affect its optimal timing? How significantly do differences in the stream of net benefits from an investment affect its optimal timing? The first two questions are examined analytically, and the last question is examined numerically. When the stream of net benefits stays constant, declines, or shifts parallel with the timing of investment, build-later is not optimal. When the stream of net benefits grows over time, however, build-later can be optimal. A necessary condition for build-later to be optimal is that initial net benefits be relatively small. When build-later is optimal, how much later to build varies significantly.

The clinical significance and optimal timing of postoperative computed tomography following cranial surgery

2010 ◽  
Vol 113 (5) ◽  
pp. 1021-1025 ◽  
Author(s):  
Ahmad Khaldi ◽  
Vikram C. Prabhu ◽  
Douglas E. Anderson ◽  
Thomas C. Origitano
Keyword(s):  
Neurological Deficit ◽  
Ct Scans ◽  
Optimal Time ◽  
Optimal Timing ◽  
Head Ct ◽  
Group A ◽  
Group B ◽  
Unexpected Findings ◽  
Over Time

Object This study was conducted to evaluate the value of postoperative CT scans in determining the probability of return to the operating room (OR) and the optimal time to obtain such scans to determine the effects of surgery. Methods Between January and December 2006 (12 months), all postoperative head CT scans obtained for 3 individual surgeons were reviewed. Scans were divided into 3 groups, which were determined by the preference of each surgeon: Group A (early scans—scheduled between 0 and 7 hours); Group B (delayed scans—scheduled between 8 and 24 hours); and Group C (urgent scans—ordered because of a new neurological deficit). The initial scans were reviewed and analyzed in 2 different fashions. The first was to analyze the efficacy of the scans in predicting return to the OR. The second was to determine the optimal time for obtaining a scan. The second analysis was a review of serial postoperative scans for expected versus unexpected findings and changes in the acuity of these findings over time. Results In 251 (74%) of 338 cases, the patients had postoperative head CT scans within 24 hours of surgery. Analysis 1 determined the percent of patients returning to the OR for emergency treatment based on postoperative scans: Group A (early)—133 patients, with 0% returning to the OR; Group B (delayed)—108 patients, with 0% returning to the OR; and Group C (urgent)—10 patients, with 30% returning to the OR (p < 0.05). Analysis 2 determined the optimal timing of postoperative scans and changes in scan acuity: Group A (early scan) had an 11% incidence of change in acuity on subsequent scans. Group B (delayed scan) had a 3% incidence of change in acuity on follow-up scans (p < 0.05). Conclusions Routine postoperative scans at 0–7 hours or at 8–24 hours are not predictive of return to the OR, whereas patients with a new neurological deficit in the postoperative period have a 30% chance of emergency reoperation based on CT scans. In addition, early postoperative scans (0–7 hours) fail to predict CT changes, which might evolve over time and may influence postoperative medical management.

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