This study, employing US listed firms with compensation peer disclosures, investigates the impact of compensation

and industry peer stock price crash risks on firms' own investments. We document three new evidences in

the examination. First, we find that firms' own investments are positively affected by compensation peer crash

risks but not industry peers. Second, we show that firms' own investments are explained by compensation peer

crash risks only. Third, we demonstrate that the compensation peer crash risks and firms' own investments

relation is positively moderated by corporate governance. Besides, additional analysis suggests that peers'

incentive effect is a possible explanation to the positive compensation peer crash risks and firms' own investments

relation.