Abstract
This paper develops a model to explore the dynamic interaction between incentive contracts and financial analysts' efforts in producing high-quality research, while accounting for both ethical and reputational concerns. Our findings indicate that compensation structures shaped by reputational and ethical considerations can give rise to incentive-related challenges. Specifically, an exclusive reliance on financial incentives exacerbates conflicts of interest, as analysts may prioritize short-term gains at the expense of their long-term reputation. In contrast, a more balanced approach, which integrates both monetary and non-monetary rewards aligned with analysts' intrinsic work ethic, allows them to better resist such pressures, leading to enhanced research quality and a strengthened long-term reputation.