YEN-CHENG CHANGMinjie HuangYu-Siang SuKevin Tseng2019-07-242019-07-242019-06-28https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3002525https://scholars.lib.ntu.edu.tw/handle/123456789/414956--CICF (Tianjin), AsianFA (Tokyo), AFBC (Sydney), TFA (Taipei), MFA (San Antonio), Paris Financial Management (Paris), SFM (Taiwan) --Best Paper Award, TFA (Taipei, Taiwan) --R&R, Contemporary Accounting ResearchIn Bolton, Scheinkman, and Xiong (2006), existing shareholders use compensation contracts to encourage short-termism when stock prices are speculative, due to investor disagreement and short-sale constraints. Supporting this view, we find an exogenous removal of short-sale constraints curbs short-termist incentives as measured by longer CEO compensation duration. This effect is concentrated among stocks with high investor disagreement and short-term-oriented institutional ownership. We also find that longer CEO compensation duration leads to longer CEO investment horizon, less overinvestment, and less earnings management.conference paper10.2139/ssrn.3002525