Summary
This is the first study to evaluate whether broad-based employee stock option programs have any effect on corporate performance. Since broad-based options are a relatively recent phenomenon, it is only now beginning to be possible to make a serious assessment of their impact on productivity. The authors found that companies with broad-based stock option plans (here, defined as those where most nonmanagement employees receive option grants) had statistically significant higher productivity levels and annual growth rates than public companies in general and their peers.