The article discusses the issue of diminished pay in executive compensation. It put forwards an analysis of traditional agency-cost case favoring incentive pay. It explains the attempts to improve decisions associated with financial firms. It states that it focuses on the compensation arrangements of senior executives like chief executive officers (CEOs) and considers the agency-cost-reducing mechanisms in corporate governance to be complementary.
Andrew C. Lund & Gregg D. Polsky,
The Diminishing Returns of Incentive Pay in Executive Compensation Contracts,
Notre Dame L. Rev.
Available at: http://scholarship.law.nd.edu/ndlr/vol87/iss2/4