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Managerial pay and firm performance -- Danish evidence


  • Eriksson, Tor
  • Lausten, Mette


This study examines the determinants of managerial compensation in a sample of Danish firms, and tests hypotheses derived from agency theory in the seldom studied (European) institutional setting of relationship-oriented governance systems. We find pay-performance sensitivity similar to that found in other settings, small differences in sensitivity across management levels, and no evidence in support of the career concern hypothesis.

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  • Eriksson, Tor & Lausten, Mette, 2000. "Managerial pay and firm performance -- Danish evidence," Scandinavian Journal of Management, Elsevier, vol. 16(3), pages 269-286, September.
  • Handle: RePEc:eee:scaman:v:16:y:2000:i:3:p:269-286

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    References listed on IDEAS

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    Cited by:

    1. Eriksson, Tor, 1999. "Executive Compensation and Tournament Theory: Empirical Tests on Danish Data," Journal of Labor Economics, University of Chicago Press, vol. 17(2), pages 262-280, April.
    2. Grund, Christian & Hofmann, Tanja, 2017. "The Dispersion of Bonus Payments within and between Firms," IZA Discussion Papers 10642, Institute for the Study of Labor (IZA).
    3. Lausten, Mette, 2001. "Gender Differences in Managerial Compensation - Evidences from Denmark," Working Papers 01-4, University of Aarhus, Aarhus School of Business, Department of Economics.
    4. Patrick Kampkoetter, 2012. "Determinants of Compensation in the Financial Services Industry," Cologne Graduate School Working Paper Series 03-12, Cologne Graduate School in Management, Economics and Social Sciences.
    5. Chalevas, Constantinos G., 2011. "The Effect of the Mandatory Adoption of Corporate Governance Mechanisms on Executive Compensation," The International Journal of Accounting, Elsevier, vol. 46(2), pages 138-174, June.
    6. Lausten, Mette, 2002. "CEO turnover, firm performance and corporate governance: empirical evidence on Danish firms," International Journal of Industrial Organization, Elsevier, vol. 20(3), pages 391-414, March.
    7. Anders Frederiksen & Odile Poulsen, 2016. "Income Inequality: The Consequences Of Skill-Upgrading When Firms Have Hierarchical Organizational Structures," Economic Inquiry, Western Economic Association International, vol. 54(2), pages 1224-1239, April.
    8. Tor Eriksson & Erik Strøjer Madsen & Mogens Dilling-Hansen & Valdemar Smith, 2001. "Determinants of CEO and Board Turnover," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 28(3), pages 243-257, September.

    More about this item


    Managerial pay Firm performance Agency theory;

    JEL classification:

    • J5 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining


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