A marketing scheme for making money off innocent people: A user's manual

C-Tier
Journal: Economics Letters
Year: 2010
Volume: 107
Issue: 2
Pages: 122-124

Score contribution per author:

1.005 = (α=2.01 / 1 authors) × 0.5x C-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

Firms often give away free goods with the product they sell. Firms often give stock options to their managers and employees. Mixing these two practices--giving stocks to consumers who buy the firm's product--creates a deadly brew. People can be lured into buying this product, giving the entrepreneur huge profits and the consumers a growing profit share. But this is a camouflaged Ponzi that will ultimately crash. It is argued, by analogy, that the common practice of giving stock options to employees can be a factor behind financial crashes. Understanding this can help create a better regulatory structure.

Technical Details

RePEc Handle
repec:eee:ecolet:v:107:y:2010:i:2:p:122-124
Journal Field
General
Author Count
1
Added to Database
2026-01-24