This paper analyzes participation decisions in employee stock purchase plans. These plans allow employees to buy company stock at a discount from the market price and resell it immediately for a sure profit. Although an average employee stands to gain $3,079 annually, only 30% of individuals take advantage of this risk-free opportunity. Participation is more … Read More
This paper explores how share repurchases affect the extant employee compensation contracts and offer a new explanation for the popularity of stock buybacks.