The article explores how different types of financial incentives can influence how employees perceive risk in a company. It shows that when future performance is uncertain, offering stock options can make employees see less risk compared to offering stocks. This means that using options can be a more cost-effective way to motivate employees. The study also reveals that increasing incentives can make employees perceive higher risk, leading to higher compensation costs. This causes companies to stick with the same compensation plans even when things change. The research also explains why some companies pay employees based on luck, even when things are uncertain.