Research on Stock Option Incentive Models on the basis of Overconfidence

摘要

Stock option incentive is the first select of many public companies when they establish incentive system.Traditional stock option incentive model stems from Traditional principal-agent model. The influence of irrational behaviors end psychological factors to stock option incentive model are not considered sufficiently, which leads to inefficient incentive.Overconfidence is a universal psychology. The influences to principal-agent relationship of overconfidence are highlights at present. Stock option incentive design on the basis of overconfidence on the condition of information symmetry and information asymmetry is discussed in this paper. The influences of overconfidence to stock option contract design including incentive coefficient, effort level, fixed compensation, agency cost and second-best expected utility of the principal are analyzed with mathematical induction. Besides, extended research of risk-neutral agent is studied. The results shows great applied value on designing stock option incentive, improving incentive efficiency and hiring agents.