Determining fair values of performance-vested and forfeiture-embedded employee stock options

Research output: Contribution to journalArticle

3 Citations (Scopus)


This study provides a new approach to determine the fair value of ESOs by extending the performance-vested option pricing model. The model developed in this study takes both vesting period and forfeiture rate into consideration to capture characteristics of ESOs. Empirical and sensitivity analyses give evidence for the importance of these two elements. Empirical results also support that the derived model can be employed to increase the accuracy of ESOs' fair value.

Original languageEnglish
Pages (from-to)1083-1106
Number of pages24
JournalAccounting and Finance
Issue number4
Publication statusPublished - 2013 Dec 1


All Science Journal Classification (ASJC) codes

  • Accounting
  • Finance
  • Economics, Econometrics and Finance (miscellaneous)

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