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Crowding Out Theory: Protecting Shareholders By Balancing Executives’ Incentives In France, The United States, & China, Palden Flynn
Crowding Out Theory: Protecting Shareholders By Balancing Executives’ Incentives In France, The United States, & China, Palden Flynn
Northwestern Journal of International Law & Business
This paper explores the differences between executive compensation regimes in France, the United States, and China. It asks whether there is a link between state regulation of real options as a form of executive compensation and state regulation of shareholder protections. This paper argues that if a country regulates the use of real options as compensation, then that country is also more likely to have strong shareholder protection laws. This argument seems to be true based on a descriptive review of executive compensation law and shareholder protections in France, the United States, and China.
If it is true that countries …