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An Empirical Study on Issues in taiwanese Employee Reward Plans

Author

Listed:
  • Wen-Hsiang Lin

    (Department of Accounting, I-Shou University, Taiwan)

  • Po-Sheng Ko

    (Department of Public Finance and Taxation, National Kaohsiung University of Applied Sciences, Taiwan)

  • Hsueh Fang Chien

    (Department of Accounting, Soochow University, Taiwan)

  • Wen-Chih Lee

    (National Kaohsiung University of Applied Sciences, Taiwan)

Abstract

The human resources are the most important input for the enterprise, so the management of talents is necessary. Especially under level-management philosophy, the agency problem between owners and professional managers often influence the pursuit of enterprise's value maximization. Therefore, an effective rewarding system can make the agent bear some performance responsibility, and can lighten the idle duty problem. Based on this argument, first, this research examines the implementation of a reward plan with employees' bonus and employees' warrant, and whether it can improve the enterprises' performances and shareholder's value. Second, this research uses the Mishkin test (1983) to analyze whether the investors have rational pricing to employees' reward system.

Suggested Citation

  • Wen-Hsiang Lin & Po-Sheng Ko & Hsueh Fang Chien & Wen-Chih Lee, 2010. "An Empirical Study on Issues in taiwanese Employee Reward Plans," Review of Pacific Basin Financial Markets and Policies (RPBFMP), World Scientific Publishing Co. Pte. Ltd., vol. 13(01), pages 45-69.
    • Handle: RePEc:wsi:rpbfmp:v:13:y:2010:i:01:n:s021909151000186x
    DOI: 10.1142/S021909151000186X
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    References listed on IDEAS

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    1. Frederic S. Mishkin, 1983. "A Rational Expectations Approach to Macroeconometrics: Testing Policy Ineffectiveness and Efficient-Markets Models," NBER Books, National Bureau of Economic Research, Inc, number mish83-1, July.
    2. Frederic S. Mishkin, 1983. "Introduction to "A Rational Expectations Approach to Macroeconometrics: Testing Policy Ineffectiveness and Efficient-Markets Models"," NBER Chapters, in: A Rational Expectations Approach to Macroeconometrics: Testing Policy Ineffectiveness and Efficient-Markets Models, pages 1-6, National Bureau of Economic Research, Inc.
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    Citations

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    Cited by:

    1. Hongfei Tang, 2014. "Are CEO stock option grants optimal? Evidence from family firms and non-family firms around the Sarbanes–Oxley Act," Review of Quantitative Finance and Accounting, Springer, vol. 42(2), pages 251-292, February.
    2. James Bannister & Harry Newman & Joseph Weintrop, 2011. "Tests for relative performance evaluation based on assumptions derived from proxy statement disclosures," Review of Quantitative Finance and Accounting, Springer, vol. 37(2), pages 127-148, August.
    3. Chii-Shyan Kuo & Jow-Ran Chang & Shih-Ti Yu, 2013. "Effect of mandatory pro forma earnings disclosure on the relation between CEO share bonuses and firm performance," Review of Quantitative Finance and Accounting, Springer, vol. 40(2), pages 189-215, February.

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    More about this item

    Keywords

    Employee bonus; employee stock option; rational pricing;
    All these keywords.

    JEL classification:

    • G1 - Financial Economics - - General Financial Markets
    • G2 - Financial Economics - - Financial Institutions and Services
    • G3 - Financial Economics - - Corporate Finance and Governance

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