Restricting CEO pay backfires: Evidence from China
نویسندگان
چکیده
Using the pay restriction imposed on CEOs of centrally administered state-owned enterprises (CSOEs) in China 2009, we study effects limiting CEO pay. Compared with firms not subject to restriction, CSOEs experienced a significant cut. In response cut, increased consumption perks and siphoned off firm resources for their own benefit. Pay-performance sensitivity these also significantly decreases. The performance dropped following restriction. Our findings suggest that restricting distorts incentives brings unintended consequences. caution against
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ژورنال
عنوان ژورنال: Journal of Business Finance & Accounting
سال: 2023
ISSN: ['1468-5957', '0306-686X']
DOI: https://doi.org/10.1111/jbfa.12741