Pay disparities within top management groups: Evidence of harmful effects on performance of high-technology firms

• 成果类型: Article
• 署名作者: Siegel, PA; Hambrick, DC
• 署名单位: Rutgers University System; Rutgers University New Brunswick; Pennsylvania Commonwealth System of Higher Education (PCSHE); Pennsylvania State University; Pennsylvania State University - University Park
• 刊物名称: ORGANIZATION SCIENCE
• ISSN/ISSBN: 1047-7039
• DOI: 10.1287/orsc.1050.0128
• 发表日期: 2005
• 页码: 259-274
• 关键词: Executive compensation; pay disparity; top management groups; high-tech firms

摘要

This study examines the interactive effect of technological intensiveness and top management group (TMG) pay disparity on firm performance. Drawing on two literatures-task interdependence and group rewards-we argue that: (a) technological intensiveness imposes a considerable requirement for multiway information processing and collaboration among senior executives of a firm, and (b) collaboration is diminished when large pay disparities exist. Hence, TMG pay disparity should be more detrimental to subsequent performance of high-technology firms than low-technology firms. We construct seven different measures of executive pay disparity based on three major types of pay disparity (vertical, horizontal, and overall) and use a proprietary data set to test our hypotheses. The results provide consistent support for our hypotheses, thereby suggesting important implications for scholars and designers of executive compensation.