1、中文 3623 字 外 文 翻 译 原文： Executive pay dispersion, corporate governance, and firm performance Executive compensation has been a central research topic in economics and business during the past two decades, recently gaining impetus in the wake of corporate scandals that have exposed significant vulnerab
2、ilities in corporate governance and the subsequent far reaching regulatory changes (SarbanesOxley). Prior research into executive compensation has primarily focused on issues related to the level and structural mix of compensation packages, and their sensitivity to firm performance (Lambert and Larc
3、ker 1987； Jensen and Murphy 1990； Yermack 1995； Baber et al. 1996； Hall and Liebman 1998； Core et al. 1999； Murphy 1999； Bryan et al. 2000). Early compensation studies focused on the CEO, subsequently expanding the scope to the compensation of the entire managerial team. Thus, for example, Aggarwal
4、and Samwick (2003) report that managers with divisional responsibilities have lower payperformance sensitivities than do managers with broad oversight authority, who in turn have lower payperformance sensitivities than does the CEO, concluding that payperformance sensitivity increases with the span
5、of authority. Similarly, Barron and Waddell (2003) examine the characteristics of compensation packages of the five highest paid executives and find that higher rank managers have a greater proportion of incentive-based compensation in pay packages than do lower ranked executives. The issue of pay d
6、ispersion across managerial team members has received conceptual attention by labor economists and organization theorists, yet scant empirical research has been performed to date. In this study, we investigate empirically the effect of managerial compensation dispersion on firm performance. We draw
7、on two competing modelsthe tournament theory and equity fairness argumentsto formulate our hypotheses: Tournament theory (Lazear and Rosen,1981) views the advancement of executives in the corporate hierarchy as a tournament in which individuals compete for promotion and rewards. High-performing exec
8、utives with considerable managerial potential win promotion and commensurate compensation. A large spread of compensation across corporate hierarchical levels attracts talented and venturesome participants to compete in the managerial tournament, providing extra incentives to exert effort. The winne
9、rs talent and the extra effort exerted will, according to the tournament model, translate to high firm performance. The empirical evidence on the tournament theory is rather limited and results are mixed. Supporting evidence comes from studies of sport activities (Ehrenberg and Bognanno,1990； Becker
10、 and Huselid,1992) and by controlled experiments (Bull et al.,1987). In business settings, Main et al. (1993), using survey data for top executives in 200 US firms, during 19801984, report that a greater spread of top-executive compensation is positively related to firm performance. Similarly, based
11、 on proprietary data of 210 Danish firms during 19921995, Eriksson (1999) provides somewhat weak evidence that higher pay dispersion is positively related to firm performance. In contrast, OReilly et al. (1988) do not find support for the tournament argument in a sample of 105 Fortune 500 firms, and
12、 Conyon et al. (2001) report that variation in executive compensation is not associated with enhanced firm performance in a sample of 100 UK firms in 1997. In contrast with the tournament model, notions of equity fairness postulate that the quality of social relations in the workplace affect firm pe
13、rformance (Akerlof and Yellen,1988,1990； Milgrom,1988； Milgrom and Roberts,1990) and that large pay dispersion adversely affects employee relations and morale, leading to counterproductive organizational activities, which eventually reduce firm performance. Supporting evidence for the adverse effect
14、s of wage dispersion on performance is also limited. Using a sample of university faculty, Pfeffer and Langton (1993) report that greater wage dispersion within academic departments reduces faculty satisfaction as well as research productivity and collaboration among colleagues. There is also some p
15、reliminary evidence in business settings (Drago and Garvey,1998) that supports the argument for equity fairness. In this study we examine a sample of 12,197 firm-year observations for 1,855 US companies spanning the period 19922003, and find that firm performance, measured by Tobins Q and alternativ
16、ely by stock returns, is positively associated with the compensation dispersion of the firms top-management team. Additionally, we document that firms with large compensation dispersion have higher future return on assets (ROA) than comparable lower pay dispersion companies. Collectively, our result
17、s suggest that the compensation dispersion of the top management team is positively related to firm performance. Our analysis also indicates that the association between firm performance and pay dispersion is conditional on agency costs and corporate governance structure. Specifically, high pay disp
18、ersion is associated with better performance in firms with high agency costs related to managerial discretion (e.g., firms with large R&D expenditures). This finding supports the notion that in firms with assets or activities that are difficult for shareholders to monitor, a greater pay dispersion m
19、itigates some of the managersshareholders agency costs by motivating managers to improve long-term firm performance. Our findings are also consistent with prior studies result that firms with high growth opportunities are more likely to substitute direct monitoring with equity-based compensation inc
20、entives to reduce agency costs of managerial discretion (Smith and Watts,1992； Gaver and Gaver,1993； Bryan et al.,2000). We further find that the positive association between firm performance and pay dispersion is stronger for firms with more effective corporate governance. Specifically, firms with
21、a high proportion of outside directors on the board and with CEOs who are not board chair have a stronger positive association between firm performance and pay dispersion. Thus, our results corroborate the complementary roles of compensation contracts and corporate governance in reducing agency costs (Mehran,1995； Hartzell and Starks,2003). This study contributes to the managerial compensation research on several dimensions. Primarily, it provides comprehensive and updated evidence that
