An Empirical Examination of Compensation of REIT Managers
Principal-agent literature finds that manager and owner incentives can be aligned with performance contingent contracts. We investigate the compensation of Real Estate Investment Trust (REIT) industry executives. The competitive nature of mortgage and equity markets, in conjunction with the corporate tax exemption available when REITs distribute most of their earnings as dividends, is likely to influence the compensation of REIT managers. Executive compensation is modeled as a function of revenues and unexpected profit. After transforming the model to reduce collinearity and heteroskedasticity, we find compensation to be generally positively related to revenue. We also find unexpected profit to be generally insignificantly related to compensation, but positively related in those cases where it is significant.
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Volume (Year): 10 (1995)
Issue (Month): 3 ()
Pages: 263-278
| Handle: | RePEc:jre:issued:v:10:n:3:1995:p:263-278 |
| Contact details of provider: | Postal: American Real Estate Society Clemson University School of Business & Behavioral Science Department of Finance 401 Sirrine Hall Clemson, SC 29634-1323 Web page: http://www.aresnet.org/ Email:
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| Order Information: | Postal: Diane Quarles American Real Estate Society Manager of Member Services Clemson University Box 341323 Clemson, SC 29634-1323 Web: http://pages.jh.edu/jrer/about/get.htm Email: |
References listed on IDEAS
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