Journal article
Properties of Performance Measures and the Demand for Discretion in Incentive Contracts
Journal of accounting, auditing & finance, Vol.36(2), pp.353-378
04/01/2021
DOI: 10.1177/0148558X19846738
Abstract
We examine how the congruity and the measurability of performance measures affect the demand for discretion in incentive contracting. We test our hypotheses using survey data from 179 profit center managers in China. Focusing on the use of non-financial performance measures, we predict and find that the demand for discretion increases as measurability decreases. Furthermore, congruity amplifies the rate of increase in the demand for discretion. Our findings add to the literature on the use of discretion in incentive contracting.
Details
- Title: Subtitle
- Properties of Performance Measures and the Demand for Discretion in Incentive Contracts
- Creators
- Jizhang Huang - Shanghai University of Finance and EconomicsRamji Balakrishnan - University of IowaFei Pan - Shanghai University of Finance and Economics
- Resource Type
- Journal article
- Publication Details
- Journal of accounting, auditing & finance, Vol.36(2), pp.353-378
- DOI
- 10.1177/0148558X19846738
- ISSN
- 0148-558X
- eISSN
- 2160-4061
- Language
- English
- Date published
- 04/01/2021
- Academic Unit
- Accounting
- Record Identifier
- 9984380375902771
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