Option compensation, dynamic investment and capital structure

被引：0

作者：

Gan, Liu ^{[1
]}

Xia, Xin ^{[2
]}

Zhang, Hai ^{[3
]}

机构：

[1] Minjiang Univ, Newhuadu Business Sch, Fuzhou, Peoples R China

[2] Zhongnan Univ Econ & Law, Sch Finance, Wuhan, Peoples R China

[3] Strathclyde Business Sch, Dept Accounting & Finance, Glasgow, Scotland

来源：

EUROPEAN FINANCIAL MANAGEMENT | 2024年 / 30卷 / 04期

基金：

中国国家自然科学基金;

关键词：

capital structure; dynamic investment; option compensation; EXECUTIVE-COMPENSATION; IDIOSYNCRATIC RISK; STOCK-OPTIONS; AGENCY; DEBT; INCENTIVES; OWNERSHIP; MANAGERS;

D O I：

10.1111/eufm.12478

中图分类号：

F8 [财政、金融];

学科分类号：

0202 ;

摘要：

We develop a dynamic trade-off model of managerial discretion to investigate how stock option compensation relates to managers' intertwined capital structure and dynamic investment decisions. Our model predicts that option grants provide managers with incentives to undertake both current and future investments, in sharp contrast to the effects of stock compensation. With an increase in option compensation, managers in low- (high-) risk firms tend to increase (decrease) firm leverage, while the opposite is true when stock pay increases. This result offers an innovative prospective on the empirical tests of the relationship between option compensation and capital structure.

引用

页码：2422 / 2445

页数：24

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