Bank Bonuses and Bailouts

Material TypeArticleLanguageEnglish
TitleBank Bonuses and Bailouts Author(S)HENDRIK HAKENES (Author)
Abstract  This paper shows that bonus contracts may arise endogenously as a response to agency problems within banks, and analyzes how compensation schemes change in reaction to anticipated bailouts. If there is a risk-shifting problem, bailout expectations lead to steeper bonus schemes and even more risk taking. ...Paginationp 259–288
Journal TitleJournal of Money, Credit, and Banking  
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