Executive compensation and the performance of the firm

A sample of large industrial corporations is examined to determine whether there is a relationship between the levels of compensation received by the senior executives of those firms and the firms' economic performances. We find consistent evidence of such a relationship, with differences across firms in the total compensation of their three highest-paid officers being positively related to differences in both the common stock returns and operating profitability of the firms. The implication is that compensation packages are designed to reduce agency costs.

Mergers, executive risk reduction and stockholder wealth

Among the possible consequences of agency problems between owners and managers is a tendency by managers to make investment decisions for their firms that are deliberately aimed at reducing firm risk, as a means to control managers' personal wealth risk. The literature has suggested that such behavior may occur to the detriment of shareholder wealth, and that mrgers may be a particular class of investment decisions for which the behavior would be observable. We test these hypotheses empirically, but find no evidence from our merger sample that risk reduction for the aqquiring firm is the typical outcome nor that, when it occurs, it is differentially costly for shareholders.

Executive compensation and executive incentive problems: an empirical analysis

The question of whether the design of the corporate executive pay package reflects an attempt to reduce agency costs between shareholders an managers is adressed. The components of senior executive pay are found to vary systematically across firms in a manner that cannot easily be explained by tax effects, and which would indicate that individual elements of pay are aimed at controlling for limited horizon and risk exposure problems. Managerial decisions and the structure of managerial pay therefore appear to be interrelated.

Merger decisions and executive stock ownership in acquiring firms

This study supports the proposition that managerial welfare affects merger decisions. The abnormal stock returns experienced by bidder firms, from the time of the announcement of a merger bid through the stockholder approval date, are positively relaterd to the percentage of own-company stock held by the senior management of the bidder. The results suggest that substantial amounts of own-company share ownership help align the interests of stockholders and management.

Repetitive transcranial magnetic stimulation: a putative add-on treatment for major depression in elderly patients.

Repetitive transcranial magnetic stimulation (rTMS) is a recent putative treatment for affective disorders. Several studies have demonstrated antidepressant effects of rTMS in younger patients; we aimed to assess its effect in older outpatients with treatment-resistant major depression. Twenty-four outpatients (mean age=62 years, S.D.=12) with major depression were randomized for sham or real stimulation and received 10 daily rTMS sessions (20 Hz, 2-s trains, 28-s intertrain intervals, 100% of motor threshold) in addition to the antidepressant medication. For sham stimulation, the coil was tilted 90 degrees. Depression severity was assessed using the Hamilton Depression Rating Scale, the Beck Depression Inventory, items from the NIMH self-rated symptom scale, and a visual analog depression scale. Mini-Mental Status Examination performance, memory, and executive and attentional functions were measured to control for cognitive side effects. Depression ratings revealed significant antidepressant effects within 2 weeks in both sham and real stimulation groups; however, there were no between-group differences. Treatment with rTMS was safe; adverse events were rare and not more prevalent in either group, and cognitive assessment did not show any deterioration. We were unable to demonstrate any additional antidepressant effects of real stimulation in elderly patients with treatment-resistant major depression. Therapeutic effects of rTMS in this clinically challenging patient group remain to be demonstrated.

Language and executive functioning: Children’s benefit from induced verbal strategies in different tasks

The interplay of language and cognition in children’s development has been subject to research for a long time. The present study followed up on recently reported deleterious effects of articulatory suppression on children’s executive functioning (Fatzer & Roebers, 2012), aiming to provide more empirical evidence on the differential influence of language on executive functioning. In the present study, verbal strategies were induced in three executive functioning tasks. The tasks were linked to the three central executive functioning dimensions of updating (Complex Span task), shifting (Cognitive Flexibility task) and inhibition (Flanker task). It was expected that the effects of the verbal strategy instruction would counter the results of articulatory suppression and thus be strong in the Complex Span task, weak but present in the Cognitive Flexibility task and small or nonexistent in the Flanker task. N = 117 children participated in the study, with n = 39 four-year-olds, n = 38 six-year-olds, and n = 40 nine-year-olds. As expected, results revealed a benefit from induced verbal strategies in the Complex Span and the Cognitive Flexibility task, but not in the Flanker task. The positive effect of strategy instruction declined with increasing age, pointing to more frequent spontaneous and self-initiated use of verbal strategies over the course of development. The effect of strategy instruction in the Cognitive Flexibility task was unexpectedly strong in the light of the only small detrimental effect of articulatory suppression in the preceding study. Implications for language’s involvement in the different executive functioning dimensions and for practice are discussed.

Prospective memory, executive functions and metacognitive control: An empirical approach to their structural interrelations in young elementary school children

Introduction Prospective memory (PM), the ability to remember to perform intended activities in the future (Kliegel & Jäger, 2007), is crucial to succeed in everyday life. PM seems to improve gradually over the childhood years (Zimmermann & Meier, 2006), but yet little is known about PM competences in young school children in general, and even less is known about factors influencing its development. Currently, a number of studies suggest that executive functions (EF) are potentially influencing processes (Ford, Driscoll, Shum & Macaulay, 2012; Mahy & Moses, 2011). Additionally, metacognitive processes (MC: monitoring and control) are assumed to be involved while optimizing one’s performance (Krebs & Roebers, 2010; 2012; Roebers, Schmid, & Roderer, 2009). Yet, the relations between PM, EF and MC remain relatively unspecified. We intend to empirically examine the structural relations between these constructs. Method A cross-sectional study including 119 2nd graders (mage = 95.03, sdage = 4.82) will be presented. Participants (n = 68 girls) completed three EF tasks (stroop, updating, shifting), a computerised event-based PM task and a MC spelling task. The latent variables PM, EF and MC that were represented by manifest variables deriving from the conducted tasks, were interrelated by structural equation modelling. Results Analyses revealed clear associations between the three cognitive constructs PM, EF and MC (rpm-EF = .45, rpm-MC = .23, ref-MC = .20). A three factor model, as opposed to one or two factor models, appeared to fit excellently to the data (chi2(17, 119) = 18.86, p = .34, remsea = .030, cfi = .990, tli = .978). Discussion The results indicate that already in young elementary school children, PM, EF and MC are empirically well distinguishable, but nevertheless substantially interrelated. PM and EF seem to share a substantial amount of variance while for MC, more unique processes may be assumed.

Physical education enhances your concentration

There is growing evidence that physical education has not only positive effects on the physical health of children and adolescents, but also contributes positively to personality development and to performance in cognitive tasks. Existing studies indicate chronic as well as acute effects of physical education on cognitive performance. However, underlying mechanisms, required content of the physical intervention and duration of the effects are still unclear. In order to shed light on some of these open questions, the present study investigated the acute effects of a special form of physical education, integrating cardiac-stimulating tasks with executive demands, on the concentration of 11-year olds. Concentration was assessed three times using the d2-R Test. Intervention (n=38) and control group (n=35) did not differ in their d2-R performance in pre- nor in post-test, which took place after either a physical intervention or a normal core subject lesson respectively. In the follow-up test however, which was completed after two more core subject lessons for both groups, the intervention group improved more in their d2-R performance than the control group F(1, 71)=4.95, p=.03, indicating that physical education can positively influence children’s concentration, not immediately after the activity, but later on during the following school lessons.