Incentive Schemes and Innovative Portfolios

  • Gino Loyola Departamento de Control de Gestión y Sistemas de Información, Universidad de Chile, Diagonal Paraguay 257, Of. 1303, Santiago
  • Yolanda Portilla Facultad de Economía y Negocios, Universidad Diego Portales, Manuel Rodríguez Sur 253, Santiago

Abstract

This article characterizes the properties of the compensation scheme of delegated portfolio management that would lead to the selection of high risk-high return portfolios. In particular, it provides conditions under which a non-monotone payment structure emerges as an optimal contract, which rewards extreme results and punishes moderate ones.
Keywords Executive compensation, delegated portfolio management, nonmonotone incentive schemes, non-monotone likelihood ratio property
Compartir
How to Cite
Loyola, G., & Portilla, Y. (2016). Incentive Schemes and Innovative Portfolios. Estudios de Economía, 37(1), pp. 43-66. Retrieved from https://estudiosdeeconomia.uchile.cl/index.php/EDE/article/view/40124/43348
Section
Articles
Published
2016-04-21