John W. Barry

John W. Barry

Hello! I am an (incoming) Assistant Professor of Finance at Rice University Jones School of Business. I study corporate governance. My job market paper studies how shareholders influence executive compensation policy through shareholder voting. I’m also interested in corporate investment (including the determination of discount rates and capital budgeting), human capital and corporate flexibility.

I have a PhD in Finance from the Fuqua School of Business at Duke University and a BA in Philosophy, Politics, Economics and Sociology (PPES) from Trinity College Dublin.

john.w.barry@duke.edu

CV

Updates

Job market paper

  • Shareholder Voice and Executive Compensation
    December 2023
    ssrn
    Abstract Managerial influence on the Board of Directors induces an agency problem in the design of executive compensation. I evaluate the role of shareholder voice in disciplining compensation practices by estimating a model of CEO compensation with non-binding shareholder approval votes (Say-on-Pay). The Board sets CEO pay and is biased towards a high wage; shareholders can fail the Say-on-Pay (SOP) and punish the Board for overpayment. Failed votes are perceived as costly by both the Board and shareholders: a cost of 2.06% (0.76%) of value for the Board (shareholders) is sufficient to match the data. SOP thus resembles a costly punishment mechanism and the disciplining effect on compensation increases firm value by 4.6% on average. Empirical evidence suggests the Board cost is a career and reputation concern for directors, and shareholders internalize a cost to dissenting from the Board on a prominent policy. I construct a counterfactual SOP mechanism which emulates giving a focal shareholder an advisory seat on the Board; this lowers the SOP failure rate, decreases wages and further increases firm value.
    Presentations (* = scheduled) LBS Transatlantic Doctoral Conference, Duke Industrial Organization Seminar, WashU Olin Finance Conference PhD Poster Session, Boca Corporate Finance and Governance Conference, MFA 2024, Eastern Finance 2024, Aarhus Strategic Interactions in Corporate Finance Workshop*