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The effects of firm performance on CEO compensation and CEO pay ratio before and during COVID-19

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  • Ye, Ryan
  • Chen, Yanan
  • Kelly, Kyle A.

Abstract

This study analyzes the effects of firm performance on CEO compensation and CEO pay ratio (the ratio of CEO compensation and the median employee's salary) before and during the COVID-19 pandemic. Using a sample of 4410 observations from S&P 1500 firms from 2018 to 2021, we find that CEO compensation and CEO pay ratio increased during the COVID-19. Firm performance, measured by return on assets and log term of firm's sales, positively affect CEO compensation and CEO pay ratio. However, the effects are the same before and during the COVID-19 pandemic.

Suggested Citation

  • Ye, Ryan & Chen, Yanan & Kelly, Kyle A., 2023. "The effects of firm performance on CEO compensation and CEO pay ratio before and during COVID-19," Research in Economics, Elsevier, vol. 77(4), pages 453-458.
    • Handle: RePEc:eee:reecon:v:77:y:2023:i:4:p:453-458
    DOI: 10.1016/j.rie.2023.07.002
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    References listed on IDEAS

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    1. Jack Clampit & Dinesh Hasija & Michael Dugan & John Gamble, 2021. "The Effect of Risk, R&D Intensity, Liquidity, and Inventory on Firm Performance during COVID-19: Evidence from US Manufacturing Industry," JRFM, MDPI, vol. 14(10), pages 1-16, October.
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    More about this item

    Keywords

    CEO compensation; CEO pay ratio; Firm performance; COVID pandemic;
    All these keywords.

    JEL classification:

    • M41 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Accounting
    • J33 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Compensation Packages; Payment Methods
    • J70 - Labor and Demographic Economics - - Labor Discrimination - - - General

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