Industry-wide managerial discretion and executive compensation

Ji Young Ahn, Kandice Kapinos

Research output: Contribution to journalArticlepeer-review


This study examines executive compensation in light of traditional agency theoretic assumptions, but also integrates institutional and environmental arguments in an attempt to understand why CEO compensation varies across industries. The authors find that the effect a CEO has on organizational outcomes varies considerably across industries. The researchers also find that some industries have considerable within-industry differences in CEO discretion on organizational outcomes, such as ROA, annual stock returns and Tobin's Q. In industries where there is a large variance in CEO impact, total CEO compensation tends to be significantly higher. However, we do not find that industry-wide CEO discretion affects contingent pay.

Original languageEnglish
Pages (from-to)203-212
Number of pages10
JournalProblems and Perspectives in Management
Issue number4
StatePublished - 2014

Bibliographical note

Publisher Copyright:
© Ji-Young Ahn, Kandice Kapinos, 2014.


  • CEO compensation
  • Industry
  • Managerial discretion


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