It’s Not Just How Many, But Who Gets Stock Options That Matters

Now that employees in many dot-com companies have suddenly found their stock options to be substantially “out of the money,” is it time to announce the death of stock options as an integral component of compensation packages? Not so fast, argue Wharton accounting professors Christopher Ittner, Richard Lambert and David Larcker in a new paper that studies whether the performance of new economy firms is related to the level of equity grants to employees.

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