To what extent do Bankers’ Compensation Packages induce risk taking behaviour?
Woolwright, Ryan (2011) To what extent do Bankers’ Compensation Packages induce risk taking behaviour? [Dissertation (University of Nottingham only)] (Unpublished)
Bankers’ Compensation Schemes have long been a topic of interest for regulators and academics alike, with early seminal work on the links between pay and performance by Jensen and Meckling (1976), and early discussions around the impact of compensation on risk taking by Nalebuff and Stiglitz (1982). Despite interest saturating over time, the Financial Crisis of 2007/2008 catapulted Bankers’ Compensation Schemes back into the headlines of media and the forefront of politics. Much of the focus was generated due to the speculation that bankers’ compensation schemes were thought to allow and reward excessive risk taking behavior, which Jickling (2010) describes as one of the contributing factors to the Financial Crisis.
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