Shareholder heterogeneity, asymmetric information, and the equilibrium manager
Elyès Jouini
- Fonction : Auteur
- PersonId : 6654
- IdHAL : elyes-jouini
- ORCID : 0000-0003-2506-1726
- IdRef : 034263209
Résumé
Consider a firm owned by shareholders with heterogeneous beliefs and discount rates who delegate to a manager the choice of a production plan. The shareholders and the manager can trade contingent claims in a complete asset market. Shareholders cannot observe the chosen production plan and design a compensation scheme so that at equilibrium the manager chooses the plan they prefer and reveals it truthfully. We show that at equilibrium (i) profit is maximized, (ii) the manager gets a constant share of production, (iii) she has no incentive to trade. We then show that such equilibrium exists if and only if the manager has the same belief and discount rate as the representative shareholder. This allows us to characterize the required characteristics of the manager as a function of shareholders' characteristics.
Domaines
Economies et financesFormat du dépôt | Notice |
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Type de dépôt | Article dans une revue |
Résumé |
en
Consider a firm owned by shareholders with heterogeneous beliefs and discount rates who delegate to a manager the choice of a production plan. The shareholders and the manager can trade contingent claims in a complete asset market. Shareholders cannot observe the chosen production plan and design a compensation scheme so that at equilibrium the manager chooses the plan they prefer and reveals it truthfully. We show that at equilibrium (i) profit is maximized, (ii) the manager gets a constant share of production, (iii) she has no incentive to trade. We then show that such equilibrium exists if and only if the manager has the same belief and discount rate as the representative shareholder. This allows us to characterize the required characteristics of the manager as a function of shareholders' characteristics.
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Titre |
en
Shareholder heterogeneity, asymmetric information, and the equilibrium manager
|
Auteur(s) |
Milo Bianchi
1
, Rose-Anne Dana
2, 3
, Elyès Jouini
4, 3
1
TSE-R -
Toulouse School of Economics
( 1002422 )
- Manufacture de Tabacs, 21 allées de Brienne 31000 Toulouse
- France
2
Université Paris Dauphine-PSL
( 300302 )
- Place du Maréchal de Lattre de Tassigny
75775 PARIS Cedex 16
- France
3
CEREMADE -
CEntre de REcherches en MAthématiques de la DEcision
( 60 )
- Place du Maréchal de Lattre de Tassigny 75775 - Paris Cedex 16
- France
4
PJSE -
Paris Jourdan Sciences Economiques
( 578027 )
- 48 boulevard Jourdan 75014 Paris
- France
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Public visé |
Scientifique
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Date de publication électronique |
2021-02-16
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Langue du document |
Anglais
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Nom de la revue |
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Vulgarisation |
Non
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Comité de lecture |
Oui
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Audience |
Internationale
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Date de publication |
2022-06
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Licence |
Copyright (Tous droits réservés)
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Volume |
73
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Numéro |
4
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Page/Identifiant |
1101-1134
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Projet(s) ANR |
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Mots-clés (JEL) |
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Domaine(s) |
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Mots-clés |
en
Heterogeneous shareholders, Asymmetric information, Manager-shareholders equilibrium
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DOI | 10.1007/s00199-021-01349-6 |
UT key WOS | 000618571300002 |
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