Falling into a Niche: Institutional Equilibrium between Plurality and Proportional Representation for Large Political Parties" Scholars of electoral systems (e.g., Duverger, 1954; Rae 1967) argue that a combination of electoral system and district magnitude provide the strategic incentives for political party competition. All electoral systems reward large parties with a disproportional seat bo...

Executive compensation is designed to create incentives for CEOs to act in the best interest of shareholders. Short-term (bonus) and equity-based incentives induce risk taking behaviors of the CEO that could further change a firm’s risk exposure. This article examines the linkage between compensation components and the impacts on a firm’s credit risk using data from the U.S. and Germany. In the...

This paper develops and estimates a model for the bonus-crediting mechanism of Danish life insurance and pension companies. The market for pension and life insurance savings contracts is generally highly opaque, but our proposed model is able to explain a significant part of the variation in actual bonus distribution by Danish market participants. The main determinant of bonus policy a is measu...

This paper studies optimal sales force compensation plans in a multi-period moral-hazard model when the firm wants to implement high effort in every period but only obtains aggregate information on sales. The sales agent chooses effort each period after observing previous sales and his incentive responsiveness might change over time. The paper derives conditions under which a linear incentive s...