Incentive-based compensation often has both negative and positive effects on the corporate environment. Corporate agents may face a dilemma that pits their individual interests against the interest of the company they serve. Underlying these internal conflicts are concepts of fairness and entitlement, traits that are often the cornerstone of negative behavioral finance decision- making. This case illustrates how issues of overconfidence, fairness and entitlement can negatively affect one’s decision making in regulated financial markets.
