Executive compensation and the performance of the firm

Loderer, Claudio; Lewellen, Wilbur; Martin, Kenneth; Blum, Gerald (1992). Executive compensation and the performance of the firm. Managerial and Decision Economics, 13(1), pp. 65-74. Wiley 10.1002/mde.4090130108

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A sample of large industrial corporations is examined to determine whether there is a relationship between the levels of compensation received by the senior executives of those firms and the firms' economic performances. We find consistent evidence of such a relationship, with differences across firms in the total compensation of their three highest-paid officers being positively related to differences in both the common stock returns and operating profitability of the firms. The implication is that compensation packages are designed to reduce agency costs.

Item Type:

Journal Article (Original Article)

Division/Institute:

03 Faculty of Business, Economics and Social Sciences > Department of Business Management > Institute of Financial Management

UniBE Contributor:

Loderer, Claudio

Subjects:

300 Social sciences, sociology & anthropology > 330 Economics

ISSN:

0143-6570

Publisher:

Wiley

Language:

English

Submitter:

Karin Dolder

Date Deposited:

24 Jan 2014 09:11

Last Modified:

26 Jun 2016 01:45

Publisher DOI:

10.1002/mde.4090130108

BORIS DOI:

10.7892/boris.39535

URI:

https://boris.unibe.ch/id/eprint/39535

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