CEO Compensation: Trends, Market Changes, and Regulation

Jarque, Arantxa
June 2008
Economic Quarterly (10697225);Summer2008, Vol. 94 Issue 3, p265
Academic Journal
The article reports on the trends, market changes and regulation on the compensation of the chief executive officers (CEO) in the U.S. It states that the main economic problem behind executive compensation design is that company owners need to align the incentives of the CEO to their own interests, typically to maximize firm value. It says that the trend used by the firms to pay their top executives includes a salary, bonus program, stock grants, grants of options on the stock of the company and long-term incentive plans that specify retirement and severance payments, as well as pension plans and deferred benefits.


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