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The Value of Luck in the Labor Market for CEOs

Amore, Mario Daniele - 2020

It is well-known that luck increases the compensation of CEOs at their current firm. In this paper, we explore how luck affects CEOs' outside options in the labor market, and the performance of firms that hire lucky CEOs. Our results show that luck at their current firm makes CEOs move to a new...

Persistent link: https://www.econbiz.de/10012832672

The degradation of distorted performance measures

Sloof, Randolph; Praag, Mirjam van - 2008

Baker (2002) has demonstrated theoretically that the quality of performance measures used in compensation contracts hinges on two characteristics: noise and distortion. These criteria, though, will only be useful in practice as long as the noise and distortion of a performance measure can be...

Persistent link: https://www.econbiz.de/10011376645

rTSR : when do relative performance metrics capture relative performance?

Ma, Paul; Shin, Jee-Eun; Wang, Charles C. Y. - 2019

market participants use to isolate managers' idiosyncratic performance-chosen by boards to evaluate managers. Among firms …

Persistent link: https://www.econbiz.de/10012064869

Peer group choice and chief executive officer compensation

Larcker, David F.; McClure, Charles; Zhu, Christina - 2019 - Draft: August 22, 2019

We examine the selection of peer groups that boards of directors use when setting CEO compensation. The challenge is to ascertain whether peer groups are selected to (i) attract and retain executive talent and/or (ii) enable rent extraction by inappropriately increasing compensation. We find...

Persistent link: https://www.econbiz.de/10012065171

Politics and gender in the executive suite

Cohen, Alma; Hazan, Moshe; Weiss, David - 2020

We investigate the relationship of CEOs' political preferences (as reflected in their political contributions) with the prevalence and compensation of women in leadership positions at U.S. public companies. We find that CEOs who favor the Democratic Party (“Democratic CEOs”) are associated...

Persistent link: https://www.econbiz.de/10012200346

Regulatory compensation limits and business performance : evidence from the National Football League

Petutschnig, Matthias - 2017

Executives' compensation has been on the forefront of the public and political debate since the recent financial crisis. One of the measures publicly discussed is a general upper boundary to top management compensation packages (“salary cap”, “maximum wage”). While such measures are...

Persistent link: https://www.econbiz.de/10011747365

Compensation consultants and the level, composition, and complexity of CEO pay

Murphy, Kevin James; Sandino, Tatiana - 2017

consultants have higher-paid CEOs—this result is robust to firm fixed-effects and matching on economic and governance variables …

Persistent link: https://www.econbiz.de/10011901860

Management compensation and the economic crisis : longitudinal evidence from the German chemical sector

Grund, Christian; Hofmann, Tanja - 2013

extent to which managers' compensation was affected by the economic crisis and the extent to which it increased afterwards … perspective. We also examine that certain parts of managers seem to have more power to influence their compensation than others …. Inequality in managers' compensation decreased during the crisis. …

Persistent link: https://www.econbiz.de/10009754706

Testing for distortions in performance measures : an application to residual income based measures like economic value added

Sloof, Randolph; Praag, Mirjam van - 2014

Distorted performance measures in compensation contracts elicit suboptimal behavioral responses that may even prove to be dysfunctional (gaming). This paper applies the empirical test developed by Courty and Marschke (2008) to detect whether the widely used class of Residual Income based...

Persistent link: https://www.econbiz.de/10010350010

Executive compensation, firm performance, and corporate governance in China : evidence from firms listed in the Shanghai and Shenzhen stock exchanges

Kato, Takao (contributor); Long, Cheryl (contributor) - 2005

managers and thus possibly making China's listed firms less effective in solving the agency problem. As such, ownership …

Persistent link: https://www.econbiz.de/10003225948