The Driver of Workplace Alienation or the Cost of Effective Stewardship? The Consequences of Wage Gap for Corporate Performance

Relying on cross-country panel data, the paper investigates possible repercussions of salary gap for employee productivity and corporate financial performance. Our empirical findings corroborate presence a negative tail effect wage morale. While worsening turnover productivity, increasing chances workplace controversies, high is found to be associated with more efficient cost structure higher profitability. evidence suggests that extreme may curbed by targeted internal policies favoring promotion career development, unionization, managerial training. The composition board’s remuneration committee appears play but minor role in shaping scale gap. results study are line equity aversion theory suggest inequality impede firms’ growth spillover effects observable at macro-level. Targeted necessary counter compensation disparities as within-firm mechanisms appear insufficient mitigate them.