Motivating Collusion

Sangeun Ha, Fangyuan Ma, Alminas Žaldokas

Publikation: KonferencebidragPaperFormidling

Abstract

We examine how executive compensation can be designed to motivate product marketcollusion. We look at the 2013 decision to close several regional offices of the Depart-ment of Justice, which lowered antitrust enforcement for firms located near these closedoffices. We argue that this made collusion more appealing to the shareholders, and findthat these firms increased the sensitivity of executive pay to local rivals’ performance,consistent with rewarding the managers for colluding with them. The affected CEOswere also granted more equity compensation, which provides long-term incentives thatcould foster collusive arrangements.
OriginalsprogEngelsk
Publikationsdato2022
Antal sider75
StatusUdgivet - 2022
Begivenhed32nd Annual Conference on Financial Economic and Accounting. CFEA 2022 - Georgia State University, Atlanta, USA
Varighed: 4 nov. 20225 nov. 2022
Konferencens nummer: 32
https://robinson.gsu.edu/academic-departments/accountancy/cfea2022/

Konference

Konference32nd Annual Conference on Financial Economic and Accounting. CFEA 2022
Nummer32
LokationGeorgia State University
Land/OmrådeUSA
ByAtlanta
Periode04/11/202205/11/2022
Internetadresse

Emneord

  • Product market collusion
  • Corporate governance
  • Managerial compensation

Citationsformater