The Impact of Tournament Incentives on Firm Risk

• Main Authors: CHEN-CHING YA, 陳敬雅
• Other Authors: 吳明政 教授
• Format: Others
• Language: zh-TW
• Published: 2013
• Online Access: http://ndltd.ncl.edu.tw/handle/74851709846797164060

碩士 === 國立彰化師範大學 === 財務金融技術學系 === 102 === Using samples of the Listed and Gre Tai Securities Markets in Taiwan over the period of 2005-2011, this paper first employs gaps between executive and non-executive compensations as measures of tournament incentives. Furthermore, this paper investigates the relationship among tournament incentives, firm’s risk-taking, and corporate policies. The empirical results show that higher tournament incentives have positive impacts on firm’s risk-taking. To increase the chance of promotion, employees put more effort on their work to meet higher level of compensations, meanwhile increases the firm’s risk. Finally, this paper finds that greater tournament incentives lead to higher R&;D intensity and leverage, but lower firm focus and capital expenditures intensity. Also, promotion tournaments provide incentives for employees to increase firm’s risk.