Deregulation and the Adaption of Governance Structures: The Case of the U.S. Airline Industry

S.R. Kole and K. Lehn

Working Papers from Rochester, Business - Financial Research and Policy Studies

Abstract: Deregulation provides a natural experiment for examining how governance adapts to structural changes in the business environment. We investigate the evolution of governance struture -- ownership concentration, compensation policy, and board composition -- in the U.S. airline industry during a 22 year period surrounding the Airline Deregulation Act of 1978.Consistent wit theory, we find that after deregulation (i) equity ownership is more concentrated, (ii) CEO pay increases, (iii) stock option grants to CEO's increase , and (iV) board size decreases.

Keywords: REGULATION; AIRLINE INDUSTRY (search for similar items in EconPapers)
JEL-codes: G32 G38 J33 L93 (search for similar items in EconPapers)
Pages: 35 pages
Date: 1997
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Persistent link: https://EconPapers.repec.org/RePEc:fth:robufr:97-05

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