The Determinants of Executive Compensation in Japan and the UK: Agency Hypothesis or Joint Determination Hypothesis?
AbstractAlthough there are many studies on executive compensation, many of these studies often take for granted the 'Anglo-American style of corporate governance'. This paper seeks to contrast the effect of corporate governance on the directors' incentive, by comparing the UK and Japan. There is a positive and significant relationship between directors' pay and employees' average wage in Japan, suggesting that both directors and employees have a similar incentive system while no such relationship is observed in the UK. These results suggest that the difference in corporate governance affects the director's salary and their incentives.
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Bibliographic InfoPaper provided by Center for Economic Institutions, Institute of Economic Research, Hitotsubashi University in its series CEI Working Paper Series with number 2001-2.
Length: 35 p.
Date of creation: Feb 2001
Date of revision:
Note: February 2001
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Executive Compensation; Corporate Governance; Company performance; Japan; UK;
Find related papers by JEL classification:
- G30 - Financial Economics - - Corporate Finance and Governance - - - General
- J33 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Compensation Packages; Payment Methods
- L20 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - General
- M10 - Business Administration and Business Economics; Marketing; Accounting - - Business Administration - - - General
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- Takao Kato & Cheryl Long, 2004. "Executive Compensation, Firm Performance, and State Ownership in China: Evidence from New Panel Data," William Davidson Institute Working Papers Series 2004-690, William Davidson Institute at the University of Michigan.
- Kato, Takao & Kubo, Katsuyuki, 2006. "CEO compensation and firm performance in Japan: Evidence from new panel data on individual CEO pay," Journal of the Japanese and International Economies, Elsevier, vol. 20(1), pages 1-19, March.
- Kato, Takao & Kim, Woochan & Lee, Ju Ho, 2007.
"Executive compensation, firm performance, and Chaebols in Korea: Evidence from new panel data,"
Pacific-Basin Finance Journal,
Elsevier, vol. 15(1), pages 36-55, January.
- Kato, Takao & Kim, Woochan & Lee, Ju Ho, 2005. "Executive Compensation, Firm Performance, and Chaebols in Korea: Evidence from New Panel Data," IZA Discussion Papers 1783, Institute for the Study of Labor (IZA).
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