Keeping the Board in the Dark: CEO Compensation and Entrenchment

We study a model in which a CEO can entrench himself by hiding information from the board that would allow the board to conclude that he should be replaced. Assuming that even diligent monitoring by the board cannot fully overcome the information asymmetry visà- vis the CEO, we ask if there is a role for CEO compensation to mitigate the inefficiency. Our analysis points to a novel argument for high-powered, non-linear CEO compensation such as bonus pay or stock options. By shifting the CEO’s compensation into states where the firm’s value is highest, a high-powered compensation scheme makes it as unattractive as possible for the CEO to entrench himself when he expects that the firm’s future value under his management and strategy is low. This, in turn, minimizes the severance pay needed to induce the CEO not to entrench himself, thereby minimizing the CEO’s informational rents. Amongst other things, our model suggests how deregulation and technological changes in the 1980s and 1990s might have contributed to the rise in CEO pay and turnover over the same period

An experimental assessment of active and passive dispersal of red snow algae on the Harding Icefield, southcentral Alaska

Red snow algae seasonally color glacier and alpine snow surfaces with characteristic red blooms. These blooms significantly reduce the albedo of the snow surface resulting in increased snow ablation. The global cryosphere is sensitive to the melt effect of expansive reoccurring blooms; however, the primary dispersal path by which snow algae seasonally recolonize snow surfaces is currently unresolved. Using an experimental field approach that inhibited resurfacing populations with a physical barrier, then sampled algal surface abundance the following growing season, we assessed two pathways of algal surface colonization on the Harding Icefield, Alaska. Our results provide the first experimental depiction of active resurfacing as the primary pathway of seasonal snow surface colonization by red snow algae above the equilibrium line elevation on an Alaskan glacier. Results suggest that, at the peak of the growing season, 65 percent of surface abundance was derived from actively resurfacing cells and 35 percent from passively dispersing cells

Ant assemblage turnover is greater horizontally than vertically in the world's tallest tropical forest

Abiotic and biotic factors structure species assembly in ecosystems both horizontally and vertically. However, the way community composition changes along comparable horizontal and vertical distances in complex three-dimensional habitats, and the factors driving these patterns, remain poorly understood. By sampling ant assemblages at comparable vertical and horizontal spatial scales in a tropical rain forest, we compared observed patterns with those predicted according to environmental filtering by microclimate and microhabitat structure. We found that although dissimilarity between ant assemblages increased with vertical distance, the dissimilarity was higher horizontally but was independent of distance. The pronounced horizontal and vertical structuring of ant assemblages across short distances is likely explained by a combination of microclimate and microhabitat connectivity. Our results demonstrate the importance of considering three-dimensional spatial variation in local assemblages and reveal how highly diverse communities can be supported by complex habitats.</jats:p

Reply to comment by Gracz on “Wetland drying and succession across the Kenai Peninsula Lowlands, south-central Alaska”Appears in the Can. J. For. Res. <b>35</b>: 1931–1941.

Gracz (2011, Can. J. For. Res. 41: 425–428) proposes that the Good Friday earthquake of 1964 caused falling lake levels and drying wetlands on Alaska’s Northern Kenai Lowlands (NKL). His hypothesis states that the earthquake increased hydraulic conductivity by fracturing a leaky confining layer, accelerating drainage of surface water into regional aquifers. We counter that a single model of draining does not apply across the heterogeneity of geomorphology and soils on the NKL. In particular, the NKL’s glacial history precludes uniform application of a subsurface hydrologic model for lake draining and the nature of peat-based wetlands precludes its application to wetland drying. Instead, small, yet cumulative, climatic reductions in moisture surplus explain both observed lake level declines and vegetation changes. Moreover, and unlike a climatic hypothesis, a seismic hypothesis fails to explain lake drying elsewhere in Alaska. Although it is likely that the earthquake influenced some hydrologic features in the NKL, it is unlikely that a single hydrologic model based on a simple mechanical cause, e.g., downward drainage, adequately explains the changes observed across the whole NKL. Conversely, we maintain that the uniformity of the vegetation response seen across different landscapes, including wetlands, forests, and alpine areas, throughout the state of Alaska strongly supports a climatic hypothesis. </jats:p

Species assemblage turnover is greater horizontally than vertically in a complex habitat

Abiotic and biotic factors structure species assembly in ecosystems both horizontally and vertically. However, the way community composition changes along comparable horizontal and vertical distances in complex three-dimensional habitats, and the factors driving these patterns, remain poorly understood. By sampling ant assemblages at comparable vertical and horizontal spatial scales in a tropical rain forest, we compared observed patterns with those predicted according to decreased resource availability in the upper canopy, environmental filtering by microclimate and microhabitat structure, presence of competition in the form of ant mosaics, and structural connectivity. We found although dissimilarity between ant assemblages increased with vertical distance, the dissimilarity was higher horizontally but was independent of distance in this dimension. Moreover, there was not a more rapid increase in horizontal distance-dissimilarity at greater heights in the canopy, as would be predicted if large competitive ant colonies drove these patterns. The pronounced horizontal and vertical structuring of ant assemblages across short distances is likely explained by a combination of microclimate and microhabitat connectivity. Our results demonstrate the importance of considering three-dimensional spatial variation in local assemblages and reveal how highly diverse communities can be supported by complex habitats.</jats:p

Recent woody invasion of wetlands on the Kenai Peninsula Lowlands, south-central Alaska: a major regime shift after 18 000 years of wet <i>Sphagnum</i>–sedge peat recruitment

We document accelerating invasion of woody vegetation into wetlands on the western Kenai Peninsula lowlands. Historical aerial photography for 11 wetland sites showed that herbaceous area shrank 6.2%/decade from 1951 to 1968, and 11.1%/decade from 1968 to 1996. Corresponding rates for converting herbaceous area to shrubland were 11.5% and 13.7%/decade, respectively, and, for converting nonforest to forest, were 7.8% and 8.3%/decade, respectively. Black spruce ( Picea mariana (Mill.) BSP) forests on three wetland perimeters established since the Little Ice Age concluded in the 1850s. Dwarf birch shrubs at three wetland sites showed median apparent tree-ring age of 13 years, indicating recent shrub colonization at these sites. Peat cores at 24 wetland sites (basal peat ages 1840 – 18 740 calibrated years before present) indicated that these peatlands originated as wet Sphagnum –sedge fens with very little woody vegetation. Local meteorological records show a 55% decline in available water since 1968, of which one-third is due to higher summer temperatures and increased evapotranspiration and two-thirds is due to lower annual precipitation. These results suggest that wet Sphagnum–sedge fens initiating since the end of the Wisconsin glaciation began to dry in the 1850s and that this drying has greatly accelerated since the 1970s. </jats:p