Sectoral differences in managers’ compensation: insights from a matching model

Emanuela Ciapanna, Marco Taboga () and Eliana Viviano
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Marco Taboga: Bank of Italy

No 1000, Temi di discussione (Economic working papers) from Bank of Italy, Economic Research and International Relations Area

Abstract: We propose a structural model of two-sided matching and a semi-parametric procedure for its estimation that allow to analyze determinants of managers’ compensation such as firm’s and manager’s quality, production technology, bargaining power and inter-temporal preferences. We use the estimated model to study the stylized fact that managers in the financial sector receive higher compensation than their peers in other sectors. Our results suggest that a predominant portion of this wage gap is explained by differences in production technology, while differences in bargaining power, preferences and quality have a minor impact and are seldom statistically significant.

Keywords: managers’ compensation; job matching (search for similar items in EconPapers)
JEL-codes: C73 D31 J63 J64 (search for similar items in EconPapers)
Date: 2015-01
New Economics Papers: this item is included in nep-hrm, nep-lab and nep-mfd
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:bdi:wptemi:td_1000_15

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