The purpose of this paper is to contribute to the research area on the connection between CEO compensation and institutional and foreign ownership using data on Swedish firms. We study the level of pay and performance-based compensation as well as probe further
Prior studies show that linking executive compensation to current accounting performance provides incentive for CEOs to manage earnings by cutting R&D expenditure (e.g. Baber et al. (1991), Bushee (1998)). However, it has also been suggested that tying executive compensation with stock price
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