Explaining Pay Disparities between Top Executives and Nonexecutive Employees: A Relative Bargaining Power Approach

Shin, Taekjin

doi:10.1093/sf/sou004

Cited by 64 publications

(51 citation statements)

References 52 publications

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“…In contrast, inequality among middle and high paid workers reflects labor's broader, contextual ability to keep top pay in check. Shin (2014) showed that dense unionization in an industry kept top pay within firms in check,…”

Section: Resultsmentioning

confidence: 99%

“…Thus, Right to Work affects the distribution of resources in ways theoretically anticipated by previous stratification research on the heterogeneity of unions and wage setting (Firpo et al 2009, Western and Rosenfeld 2011, Shin 2014).…”

mentioning

confidence: 79%

“…These linkages have been found to occur within industry-regions Rosenfeld 2011, Rosenfeld et al 2016), occupation-regions (Denice and Rosenfeld 2018), and along career trajectories (VanHeuvelen 2018a). Strong unions also shift a greater share of total national income to labor (Kristal 2013) and keep in check the takeoff of top managerial pay (DiNardo et al 1997, Shin 2014, Jaumotte and Buitron 2015. Through their influence on wages of members and similar non-members, unions have a direct effect on inequality in the middle and bottom of the wage distribution, while broader mechanisms linked to union strength-normative and political pressure, for example-results in an indirect effect on inequality among high wages.…”

Section: Background Power Resources Politics and Union Changementioning

confidence: 99%

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The Right to Work, Power Resources, and Economic Inequality

VanHeuvelen¹

2019

Preprint

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How do Right to Work laws affect the distribution of economic resources? While sociological theories would predict inequality to increase following the passage of Right to Work laws, previous research has found these laws to be largely inconsequential for economic inequality. Drawing on power resources theory, I reassess the consequences of Right to Work laws and allow their impact to depend upon local union membership. To do so, I construct unique datasets at the state and commuting zone levels of income and wage inequality, merging data from the Internal Revenue Service, the US census, the American Community Survey, the US Union Sourcebook, the Current Population Survey, and the National Labor Relations Board for years 1939 to 2016. After using two-way fixed effects and instrumental variable regression models to replicate inconsistent results of previous studies, I show that these mask substantial and robust heterogeneity across local areas. Simply put, Right to Work laws are highly consequential when passed in times and places where labor has something to lose. Right to Work laws remove the negative association between labor union membership and inequality, while the consequences of Right to Work passage are greatest in highly unionized areas. In total, results suggest that Right to Work laws work as intended, increasing economic inequality indirectly by lowering labor power resources. Theoretical and policy implications are discussed.

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Section: Resultsmentioning

confidence: 99%

mentioning

confidence: 79%

Section: Background Power Resources Politics and Union Changementioning

confidence: 99%

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The Right to Work, Power Resources, and Economic Inequality

VanHeuvelen¹

2019

Preprint

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“…Obviously, it is unlikely that the changed dividend policies of Japanese firms alone caused such gap. But its impact on income disparities could still be substantial when combined with other measures of shareholder value maximization, such as executive stock options (Shin ). Further research is warranted to explore the distributional implications of increased dividend payouts by Japanese firms and, more broadly, the global diffusion of shareholder value in Japan.…”

Section: Resultsmentioning

confidence: 99%

Bending but Not Breaking?: Foreign Investor Pressure and Dividend Payouts by Japanese Firms

Jung

Mun

2016

Sociological Forum

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This article examines the global diffusion of shareholder-oriented governance practices, using the case of dividend payouts by Japanese firms. While Japanese firms previously retained profits for rainy days or new ventures, their dividend payouts began to increase in the 1990s, rapidly catching up with the levels prevailing in the United States. Following prior research, we focus on the role of foreign investors in this process but provide a more nuanced account of their influence, using panel data on 2,036 publicly traded Japanese firms from 1990 to 2005. First, we show that pressure from foreign investors increased dividends by Japanese firms not only directly but also indirectly, by extending the cognitive boundaries of organizational fields of Japanese firms beyond their local peers and toward their global competitors. Second, we show that although Japanese firms that remained deeply embedded in the traditional, stakeholder-oriented governance system resisted shareholder-oriented governance practices, even such firms yielded under pressure from both foreign and domestic investors. We conclude with theoretical implications of our findings for the literature on the global diffusion of shareholder value and its broader political and social consequences.

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“…EEPG is measured by logarithm of difference between the average of executive compensation and the average of employees' compensation [17].…”

Section: Methodsmentioning

confidence: 99%

Role of CEO Age in Determining Executive-employee Pay Gap in Chinese Listed Manufacturing Companies: A Perspective of Risk Aversion

Zhang

Guo

2017

MATEC Web Conf.

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Abstract. The paper investigates the effect of CEO age on executive-employee pay gap (EEPG), a newly focused dimension of executive compensation arrangements by the literature, by choosing the panel data consisting of 3495 firm-years in Chinese listed manufacturing companies during 2010-2014 as the research sample. Empirical analysis based on multiple regression analysis adopting the method of OLS by applying SPSS19.0 makes a new finding, i.e., there is a positive relationship between CEO age and EEPG, which holds robust with the change of the measures. Further investigation on the determination mechanism of CEO age on EEPG show that older CEOs intend to set relatively lower EEPG out of their risk aversion needs.

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Explaining Pay Disparities between Top Executives and Nonexecutive Employees: A Relative Bargaining Power Approach

Cited by 64 publications

References 52 publications

The Right to Work, Power Resources, and Economic Inequality

The Right to Work, Power Resources, and Economic Inequality

Bending but Not Breaking?: Foreign Investor Pressure and Dividend Payouts by Japanese Firms

Role of CEO Age in Determining Executive-employee Pay Gap in Chinese Listed Manufacturing Companies: A Perspective of Risk Aversion

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