| Summary: | 碩士 === 朝陽科技大學 === 會計所 === 93 === Abstract
The quality of decisions made by the executives has great influence on the research and development (R&D) operations in a firm. The executives should get proper rewards for the achievements of the R&D operations. The firm should not deal out the current earning as the rewards of the executives because of the characteristic that the performances of the R&D operations are laggard and uncertain (Scherer 1965). The value of employee stock option is determined on the future stock price of this firm due to the limit of lock period. Therefore, as the performances of the executives are connected with the stock price, employee stock option is a good choice as the rewards for the executives, tying in rewards and performance.
This research identify that the scale of R&D expenditure is the main factor, the development variable being the expenditure of R&D operation, when the listed companies offer some amount of employee stock option.
The results show that the amount of employee stock option and expenditure of R & D operation reveal positive relation significantly. As the other factors are fixed, the firms propose offering about 33 units of stock option when increasing 1000 NTD. From sensitivity analysis, the results are conservative of time, types of industry, and markets.
Key words: Employee option, research and development expenditure, employee rewards, performance
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