Li Sun

Citation

Thesis Title
Essays on the Determinant and Consequence of Tournament Incentives: Evidence from China

Read article at Massey Research Online:

A growing debate following the recent financial crisis concerns the inefficiency of arranged managerial incentive schemes, and the difficultly associated with evaluating an agent’s efforts objectively. Thus, it is important to design managerial incentives from a more dynamic view, which can better align principal and agent interests. Tournament incentives that reward managers based on relative performance, rather than absolute levels of output, are considered more relevant for monitoring managerial behaviours. However, existing evidence is inconsistent regarding whether tournaments can function as an efficient governance mechanism. Additionally, most studies have been conducted in the U.S. Consequently, whether it is applicable in emerging markets has remained under-explored. By investigating its impacts in terms of business strategy and stock price crash risk using Chinese firms, Ms Sun's research has provided valuable insights regarding the use of tournament incentives in emerging economies, like China.

Supervisors
Professor Ahsan Habib
Dr Hedy Huang