CEO Pay Disclosure and Within-Firm Wage Inequality

Agata Maida and Vincenzo Pezone ()
Additional contact information
Vincenzo Pezone: Tilburg University

No 17243, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: We analyze the effect of CEO pay disclosure on wage distribution by exploiting a 1998 reform requiring Italian publicly listed companies to disclose top executives' compensation. In firms where CEOs disclose high total compensation, the top 5 percent and 1 percent of the within-firm wage distribution rise substantially. Instead, the effect on average wages is small and only marginally significant. As a result, wage inequality increases. These effects are stronger for workers with low experience or located in the main region of the firm's operations. Moreover, they are driven by changes in workers' bargaining power, rather than by sorting.

Keywords: CEO compensation; wage disclosure; income inequality; wage bargaining (search for similar items in EconPapers)
JEL-codes: D63 D9 J31 M12 (search for similar items in EconPapers)
Pages: 41 pages
Date: 2024-08
New Economics Papers: this item is included in nep-hrm, nep-ipr and nep-lma
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://docs.iza.org/dp17243.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:iza:izadps:dp17243

Ordering information: This working paper can be ordered from
IZA, Margard Ody, P.O. Box 7240, D-53072 Bonn, Germany

Access Statistics for this paper

More papers in IZA Discussion Papers from Institute of Labor Economics (IZA) IZA, P.O. Box 7240, D-53072 Bonn, Germany. Contact information at EDIRC.
Bibliographic data for series maintained by Holger Hinte ().