Plausibly Exogenous [1647] - EPS Management (08/06/2024)

LHS Variable
EPS management

RHS Variable
Equity-based compensation

Source of Exogenous Variation
Discontinuity that rises from “just-in-the-money” option exercises due to randomness ins tock prices

- Gao and Kronlund (2020), “Does Equity-based Compensation Cause Firms to Manage Earnings Per Share?”