IDEAS home Printed from https://ideas.repec.org/a/taf/rcjaxx/v4y2016i1p53-78.html
   My bibliography  Save this article

Will political promotion expectation decrease the pay gap in state-owned enterprises in China?

Author

Listed:
  • Danlu Bu
  • Chenyu Zhang
  • Teng Lin

Abstract

In this paper, we test the effects of executives’ promotion expectation on compensation and the pay gap between executives and employees in China. We measure the promotion expectation of current executives by using their predecessors’ promotion ranks and direction. We find that there is a significantly negative relationship between promotion expectation and the pay gap, suggesting that senior executives with stronger expectation of political promotion are more willing to accept less compensation and therefore a smaller pay gap. Furthermore, we find that different types of promotion expectation have different effects on senior executives’ perceptions. Compared with intra-group promotion, political promotion expectation has greater effects on limiting executive compensation and narrowing the pay gap. However, we find that promotion expectation fails to mitigate agency conflicts between shareholders and managers and further motivates the executives to maximise firm value.

Suggested Citation

  • Danlu Bu & Chenyu Zhang & Teng Lin, 2016. "Will political promotion expectation decrease the pay gap in state-owned enterprises in China?," China Journal of Accounting Studies, Taylor & Francis Journals, vol. 4(1), pages 53-78, January.
    • Handle: RePEc:taf:rcjaxx:v:4:y:2016:i:1:p:53-78
    DOI: 10.1080/21697213.2016.1144969
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1080/21697213.2016.1144969
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1080/21697213.2016.1144969?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Kong, Gaowen & Huang, Jiating & Ma, Guangyuan, 2023. "Anti-corruption and within-firm pay gap: Evidence from China," Pacific-Basin Finance Journal, Elsevier, vol. 79(C).

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:taf:rcjaxx:v:4:y:2016:i:1:p:53-78. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Chris Longhurst (email available below). General contact details of provider: http://www.tandfonline.com/rcja .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.