IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Login to save this article or follow this journal

Incentive and Dilution Effects of Employee Stock Bonuses and Stock Options: Evidence from Taiwan

  • Miao-Ling Chen
Registered author(s):

    Employee stock bonuses (ESBs) and employee stock options (ESOs) are the means for high-technology companies in Taiwan to reward their employees. This research connects the Ohlson (1995) model and Linear Structural Relations (LISREL) model to investigate these effects of ESBs and ESOs, respectively, for a sample of high-technology companies in Taiwan. I generate two empirical generalizations. (1) The incentive effects of ESBs are significantly associated with performance, thus enhancing firm value; in addition, the incentive effects of ESBs are greater than the dilution effects. (2) The incentive effects of ESOs are also significantly associated with performance, whereas the dilution effects of ESOs are insignificant. Although evidence supports the incentive effects of providing ESOs and ESBs, it is debatable whether ESOs and ESBs dilute shareholders' equity.

    If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

    File URL: http://www.tandfonline.com/doi/abs/10.1080/14765280601109352
    Download Restriction: Access to full text is restricted to subscribers.

    As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.

    Article provided by Taylor & Francis Journals in its journal Journal of Chinese Economic and Business Studies.

    Volume (Year): 5 (2007)
    Issue (Month): 1 ()
    Pages: 65-73

    as
    in new window

    Handle: RePEc:taf:jocebs:v:5:y:2007:i:1:p:65-73
    Contact details of provider: Web page: http://www.tandfonline.com/RCEA20

    Order Information: Web: http://www.tandfonline.com/pricing/journal/RCEA20

    No references listed on IDEAS
    You can help add them by filling out this form.

    This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

    When requesting a correction, please mention this item's handle: RePEc:taf:jocebs:v:5:y:2007:i:1:p:65-73. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Michael McNulty)

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If references are entirely missing, you can add them using this form.

    If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.