Crazy Compensation and the Crisis


Print | No Comments | Share/Save

Published in The Wall Street Journal May 28, 2009 by Alan S. Blinder

Despite the vast outpouring of commentary and outrage over the financial crisis, one of its most fundamental causes has received surprisingly little attention. I refer to the perverse incentives built into the compensation plans of many financial firms, incentives that encourage excessive risk-taking with OPM — Other People’s Money.

Link to full article.

Post a Comment