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Description
In this study, I examine the extent to which firms rely on relative performance evaluation (RPE) when setting executive compensation. In particular, I examine whether firms use information about peer performance to determine compensation at the end of the year, i.e. after both firm and peer performance are observed. I

In this study, I examine the extent to which firms rely on relative performance evaluation (RPE) when setting executive compensation. In particular, I examine whether firms use information about peer performance to determine compensation at the end of the year, i.e. after both firm and peer performance are observed. I find that RPE is most pronounced for firms that allow little or no scope for ex post subjective adjustments to annual bonuses. Conversely, firms that rely mainly on subjectivity in determining bonus exhibit little use of RPE. These findings suggest that information about peer performance is not used at the end of the year. Instead, peer performance seems to be incorporated in performance targets at the beginning of the year, at least among firms primarily using objective performance measurements. In addition, I provide new evidence on the determinants of the use of subjectivity.
ContributorsTsui, Stephanie (Author) / Matejka, Michal (Thesis advisor) / Hwang, Yuhchang (Committee member) / Kaplan, Steven (Committee member) / Arizona State University (Publisher)
Created2013
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Description
In today's era a lot of the construction projects suffer from time delay, cost overrun and quality defect. Incentive provisions are found to be a contracting strategy to address this potential problem. During last decade incentive mechanisms have gained importance, and they are starting to become adopted in the construction

In today's era a lot of the construction projects suffer from time delay, cost overrun and quality defect. Incentive provisions are found to be a contracting strategy to address this potential problem. During last decade incentive mechanisms have gained importance, and they are starting to become adopted in the construction projects. Most of the previous research done in this area was purely qualitative, with a few quantitative studies. This study aims to quantify the performance of incentives in construction by collecting the data from more than 30 projects in United States through a questionnaire survey. First, literature review addresses the previous research work related to incentive types, incentives in construction industry, incentives in other industry and benefits of incentives. Second, the collected data is analyzed with statistical methods to test the significance of observed changes between two data sets i.e. incentive projects and non-incentive projects. Finally, the analysis results provide evidence for the significant impact of having incentives; reduced the cost and schedule growth in construction projects in United States.
ContributorsPaladugu, Bala Sai Krishna (Author) / El Asmar, Mounir (Thesis advisor) / Ernzen, James (Committee member) / Sullivan, Kenneth (Committee member) / Arizona State University (Publisher)
Created2015