Work

Executive pay and performance Evidence from the U.S. banking industry

Year: 1995

Type: article

Abstract: This paper examines CEO pay in the banking industry and the effect of deregulating the market for corporate control. Using panel data on 147 banks over the 1980s, we find higher levels of pay in competitive corporate control markets, i.e., those in which interstate banking is permitted. We also find a stronger pay-performance relation in deregulated interstate banking markets. Finally, CEO turnover increases substantially after deregulation. These results provide evidence of a managerial talent market — one which matches the level and structure of pay with the competitiveness of the banking environment.

Source: Journal of Financial Economics

DOI: 10.1016/0304-405x(94)00816-j

Authors: R.Glenn Hubbard, Darius Palia

Institution: Columbia University

Language: English

Topic: Corporate Finance and Governance

Subfield: Finance

Field: Economics, Econometrics and Finance

Domain: Social Sciences

SDGs: Decent work and economic growth, Peace, justice, and strong institutions

Open Access status: hybrid

Estimated APC paid: $4,740