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To: Ilaine who wrote (19200)	5/20/2002 9:47:32 AM
From: Moominoid	Respond to of 74559

Usually neoclassical economists assume people maximize their own interest. When they are apparently altruistic then that is something that is interesting. The problem often is that being CEO is the end of the career (well there are still board positions and the like). So it doesn't really matter in terms of your future career prospects if the company bombs 2 years after you step down as long as earnings were up while you were in charge your options will do fine. It's these longer term "repeated game" scenarios that lead people to act in more apparently altruistic ways even if they are basically selfish. They should really pay pensions according to the future profits of the corporation... instead of stock options that vest while you are still in the job. That would be real "long-term" compensation. The question is how to get out of the current equilibrium where massive stock options are standard. Especially at US corporations where the CEO and chairman are frequently the same person and the board sets CEO compensation. Maybe we need a depression to reset the standards?