The Value of Stock Options To Non-Executive Employees

This study empirically investigates the value employees place on stock options using information from the option exercise behavior of individuals. Employees hold options for another period if the value from holding them and reserving the right to exercise them later is higher than the value of exercising them immediately and collecting a profit equal to the stock price minus the exercise price. This simple model implies the hazard describing employee exercise behavior reveals information about the value to employees of holding options another time period. We show the parameters of this model are identified with data on multiple option grants per employee and we apply this model to the disposition of options received in the 1990s by a sample of over 2000 middle-level managers from a large, established firm outside of manufacturing. Exercise behavior is modeled using a random effects probit model of monthly exercise behavior that is estimated using simulated maximum likelihood estimation methods. Our estimates show there is substantial heterogeneity (observed and unobserved) among employees in the value they place on their options. Our estimates show most employees value their options at a value greater than the option’s Black-Scholes value

Premium Copayments and the Trade-off between Wages and Employer-Provided Health Insurance

This paper estimates the trade-off between salary and health insurance costs using data on Illinois school teachers between 1991 and 2008 that allow us to address several common empirical challenges in this literature. We find no evidence that changes in teachers’ salaries respond to changes in insurance cost, but teachers paid about 17 percent of the cost of individual health insurance and about 46 percent of the cost of their family members’ plans through increased premium copayments. Our results indicate that premium increases were not associated with commensurate increases in teachers’ valuation of their health insurance plans

New Data for Answering Old Questions Regarding Employee Stock Options

This paper is a description and summary of existing questions and sources of data on stock options with an emphasis on two issues; what are the issues surrounding stock options in the national accounts and what value do employees place on stock options? We survey many existing data sources and outline some of the ways these data can be used to answer questions about the use and impact of employee stock options. The data sources include administrative records from individual firms, survey data of employee perceptions, disclosure filings with the SEC and other government, nonprofit, and international sources. We explore ways to investigate the value of options to employees and their cost to the firms using data on employee exercise decisions. Finally, we discuss the implications of our findings for public policy, the reporting of stock options, and how options are considered in the national accounts

Employees’ Choice of Method of Pay

Who chooses what type of pay? The costs and benefits of “flexible” and “cafeteria-style” benefit plans have been discussed for some time. Additionally, many papers have considered the potential costs and benefits of certain types of pay plans (e.g. salaries versus piece rates). In this paper, we use detailed data from a specific firm that annually set the total compensation level for each of its employees but then did something extremely unusual. At the start of each pay year, the firm set an exchange rate for the dollar trade-off between cash pay and stock option pay. It then gave every employee nearly complete choice over the fraction of their pay that was contingent (stock options, bonus) versus guaranteed (salary). There are several empirical findings. There is substantial variation in the choice of contingent pay with some workers choosing almost all base pay and others choosing almost entirely stock options. Younger employees, more experienced employees, higher paid employees, and male employees are more likely to allocate a larger fraction of their total compensation to at-risk alternatives. The robustness of these results varies somewhat depending on the empirical specification and set of covariates used

The Value of Stock Options to Non-Executive Employees

This study empirically investigates the value employees place on stock options using information from the option exercise behavior of individuals. Employees hold options for another period if the value from holding them and reserving the right to exercise them later is higher than the value of exercising them immediately and collecting a profit equal to the stock price minus the exercise price. This simple model implies the hazard describing employee exercise behavior reveals information about the value to employees of holding options another time period. We show the parameters of this model are identified with data on multiple option grants per employee and we apply this model to the disposition of options received in the 1990s by a sample of over 2000 middle-level managers from a large, established firm outside of manufacturing. Exercise behavior is modeled using a random effects probit model of monthly exercise behavior that is estimated using simulated maximum likelihood estimation methods. Our estimates show there is substantial heterogeneity (observed and unobserved) among employees in the value they place on their options. Our estimates show most employees value their options at a value greater than the option's Black-Scholes value.

Processing Narratives by Means of Action Languages

In this work we design a narrative understanding system Text2ALM that can be used in Question Answering domains. System Text2ALM utilizes an action language ℒℳ to perform inferences on complex interactions of events described in narratives. The methodology that Text2ALM follows in its implementation was originally outlined by Yuliya Lierler, Daniela Inclezan, and Michael Gelfond in 2017 via a manual process, and this work serves as a proof of concept in a large-scale environment. Our system automates the conversion of a narrative to an ℒℳ model containing facts about the narrative. We make use of the VerbNet lexicon that we annotated with interpretable semantics in ℒℳ. Text2ALM also utilizes Text2DRS system developed by Gang Ling at UNO in 2018. These resources are used to produce an ℒℳ program with a system description containing information on the narrative’s entities, events, and their relations, as well as a history of the narrative’s events. The ℒℳ logic is used in tandem with a basic commonsense library of ℒℳ modules to generate a formal structure capturing the narrative’s properties. The CALM system designed by researchers at Texas Tech in 2018 and is used by Text2ALM to process the ℒℳ program. The effectiveness of this approach is measured by the system’s ability to correctly answer questions from the QA bAbI tasks published by Facebook Research in 2015. The Text2ALM system matched or exceeded the performance of state-of-the-art machine learning methods in six of the seven tested tasks

The Relationship between School Learning Climate and Student Achievement

Based on the review of the literature and research, the relationship of school learning climate and student achievement is explored. Common ideological, organizational, and leadership factors characteristic of high-achieving, effective schools are identified and their relationships examined. Ideological factors identified are: 1) A belief that all students are expected by staff to reach high levels of achievement; 2) A belief that individual and school-wide performance on achievement tests is an appropriate goal and measure of school effectiveness; and 3) A belief that self-concept is an important factor in student achievement. Organizational factors identified are: 1) High degree of trust; 2) High level of satisfaction and morale; 3) Opportunity for input; and 4) Safe and orderly environment. Leadership factors examined are: 1) Sense of vision; 2) Clearly stated goals and expectations; 3) Effective communication skills; and 4) Strong instructional leadership

Spark Without Flame: The German Library of Information A Nazi Propaganda Agency in the United States, 1936-1941

Most studies of Nazi propaganda have focused on main events inside Germany. This thesis proposes to examine German efforts in the United States in the years before American entry into the Second World War. This will be done by examining one Nazi agency: the German Library of Information which operated out of New York City from 1936 to 1941. The first chapter explores the formation of the German Library of Information and its goals. The question of whether it as controlled by the Foreign Office or the Propaganda Ministry is also discussed. The second chapter cover the association between the German Library of Information and George Sylvester Viereck. This reltaionship was an important part of the expansion of the organization after the outbreak of World War II. Viereck provided the German Library of Information with most of its editorial guidance. The third chapter delves into the German Library of Information\u27s publication of propaganda pamphlets. Each of the major pamphlets is examined in detail. These works attempted to blame Britain for the outbreak, continuation and expansion of World War II. The publications also stressed the economic and military strenght of Germany and urged the United States to stay out of the war. Chapter four focuses on the German Library of Information\u27s weekly magazine Facts in Review. The magazine was set up to provide Americans with the German point of view on world events. Facts in Review continued the theme of British responsibility for the war. Germany\u27s policies in Europe were explained in its pages as similar to American policies in Latin America. Facts in Review tried to convince its readers that they had the most to gain by working with, not against, the Third Reich. Chapter five discusses the Dies Committee investigation into the German Library of Information\u27s activites. In addition to covering the demise of the German Library of Information, this chapter also discusses the fate of its American editor George Viereck