Managerial Attributes and Executive Compensation

• 成果类型: Article
• 署名作者: Graham, John R.; Li, Si; Qiu, Jiaping
• 署名单位: Duke University; National Bureau of Economic Research; Wilfrid Laurier University; McMaster University
• 刊物名称: REVIEW OF FINANCIAL STUDIES
• ISSN/ISSBN: 0893-9454
• DOI: 10.1093/rfs/hhr076
• 发表日期: 2012
• 页码: 144
• 关键词: relative performance evaluation; HIGH WAGE WORKERS; firm performance; ceo compensation; cross-section; pay; MODEL; determinants; persistence; industry

摘要

We study the role of firm- and manager-specific heterogeneities in executive compensation. We decompose the variation in executive compensation and find that time-invariant firm and, especially, manager fixed effects explain a majority of the variation in executive pay. We then show that in many settings, it is important to include fixed effects to mitigate potential omitted variable bias. Furthermore, we find that compensation fixed effects are significantly correlated with management styles (i.e., manager fixed effects in corporate policies). Finally, the method used in the article has a number of potential applications in financial economics.