CEO compensation contagion: Evidence from an exogenous shock

• 成果类型: Article
• 署名作者: Bereskin, Frederick L.; Cicero, David C.
• 署名单位: University of Delaware; University of Tennessee System; University of Tennessee Knoxville
• 刊物名称: JOURNAL OF FINANCIAL ECONOMICS
• ISSN/ISSBN: 0304-405X
• DOI: 10.1016/j.jfineco.2012.09.005
• 发表日期: 2013
• 页码: 477-493
• 关键词: Executive compensation; Classified board; Poison pill; DELAWARE; corporate governance

摘要

We examine how Chief Executive Officer (CEO) compensation increased at a subset of firms in response to a governance shock that affected compensation levels at other firms in the economy. We first show that Delaware-incorporated firms with staggered boards and no outside blockholders increased CEO compensation following the mid-1990s Delaware legal cases that strengthened their ability to resist hostile takeovers. Consistent with the Gabaix and Landier (2008) contagion hypothesis, non-Delaware firms subsequently increased CEO compensation when the rulings affected a substantial number of firms in their industries. We further show how these legal developments contributed significantly to the rapid increase in CEO compensation in the late 1990s. (c) 2012 Elsevier B.V. All rights reserved.