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Promotion Incentives and Corporate Performance: Is There a Bright Side to "Overpaying" the CEO?


  • Jayant R. Kale
  • Ebru Reis
  • Anand Venkateswaran


Earlier studies have shown that stronger equity-based incentives for CEOs are generally associated with better corporate performance and higher values. In this article, the authors report the findings of their recent study of the effects of promotion-based "tournament" incentives for non-CEO executives (or "VPs") on corporate performance for a large sample of companies during the 12-year period from 1993-2004. Copyright Copyright (c) 2010 Morgan Stanley.

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  • Jayant R. Kale & Ebru Reis & Anand Venkateswaran, 2010. "Promotion Incentives and Corporate Performance: Is There a Bright Side to "Overpaying" the CEO?," Journal of Applied Corporate Finance, Morgan Stanley, vol. 22(1), pages 119-128.
  • Handle: RePEc:bla:jacrfn:v:22:y:2010:i:1:p:119-128

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