Globalization and Executive Compensation

Wolfgang Keller and William Olney

No 12026, CEPR Discussion Papers from Centre for Economic Policy Research

Abstract: Employing comprehensive data on top executives at major U.S. companies, we show that their compensation is increasing with exports, as well as firm size and technology. Exogenous export shocks unrelated to managerial decisions also increase executive compensation, and there is little evidence that this is due to increasing returns to talent. We do find that export shocks primarily affect discretionary forms of compensation of more powerful executives at firms with poor corporate governance, as one would expect if globalization has enhanced rent-capture opportunities. Overall, globalization has been more important for the rapid growth of executive compensation and U.S. inequality than previously thought, with rent-capture playing a role.

Keywords: Inequality; Globalization; Executive compensation; Corporate governance; Distributional effects (search for similar items in EconPapers)
JEL-codes: F14 F16 F66 J31 M12 (search for similar items in EconPapers)
Date: 2017-05
New Economics Papers: this item is included in nep-bec, nep-hrm, nep-int and nep-lma
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Citations: View citations in EconPapers (10)

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Related works:
Journal Article: Globalization and executive compensation (2021)
Working Paper: Globalization and Executive Compensation (2018)
Working Paper: Globalization and Executive Compensation (2017)
Working Paper: Globalization and Executive Compensation (2017)
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