Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/74908
Authors: 
Gregorič, Aleksandra
Polanec, Sašo
Slapničar, Sergeja
Year of Publication: 
2008
Series/Report no.: 
LICOS Discussion Paper 220
Abstract: 
This paper studies the impact of external reference values on managerial compensation contracts. We consider the effect of adoption of non-binding pay nfirms on actal remuneration behavior using a unique country example. We find that introduction of pay nfirms changed the reference values for CEOs and led to adjustment of executive compensation towards new equilibrium. These pay nfirms affected pay in firms with actual compensation below and above reference values. Further we find that reference values changed compensation in all types of firms, although executive compensation increased more in firms with more dispersed ownership and control. These results confirm the importance of reference values in bargaining process between owners and managers.
Subjects: 
executive compensation
bargaining
reference values
ownership structure
JEL: 
G30
G34
Document Type: 
Working Paper

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