In Chapter 1, Vol 5 of Archival Insights into the Evolution of Economics (_Hayek: a Collaborative Biography Part 1 Influences, From Mises to Bartley_ (2013) Palgrave Macmillan), there is a discussion of the excess compensation sceptic literature:
Jensen, M. and Meckling, W. 1976. Theory of the firm: Managerial behaviour, agency costs and ownership structure. Journal of Financial Economics October, 1976, V. 3, No. 4: 305-360.
Jensen, M. and Murphy, K. 1990. CEO Incentives – it’s not how much you pay, but how. Harvard Business Review May.
RL
----- Original Message -----
From: "ALCOUFFE ALAIN" <[log in to unmask]>
To: [log in to unmask]
Sent: Tuesday, 7 May, 2013 8:29:49 PM
Subject: [SHOE]
Hi, Robin,
I'm not sure what Robin means with excess compensation but without
tracking the issue back to Veblen or Hobson, you could consider to
read :
Roberts, David R., "A General Theory of Executive Compensation Based
on Statistically Tested. Propositions," Quarterly Journal of Economics
70, May 1956,
Herbert A. Simon The Compensation of Executives, Sociometry, Vol. 20,
No. 1 (Mar., 1957), pp. 32-35
McGuire, J.W., Chiu, J.S.Y., and Elbing, A.O. (1962). Executive
income, sales, and profits. American Economic Review, 52(4), 753?761
R. J. Monsen and A. Downs, "A Theory of Large. Managerial Firms,"
Journal of Political Economy, LXXIII (June 1965)
These papers are discussed at length in my unfortunately in French
1976 PhD (along with papers and books by O. E. Williamson).
best
"Mayhew, Anne" <[log in to unmask]> a écrit :
> In response to Robin Neill's question re a measurement of "excess
> compensation":
>
> Veblen might have responding by asking for what income recipients we
> do have empirical measurement other than compensation to use in
> determining the value of contribution. J.A. Hobson, in a similar
> spirit, observed that all production is joint and determination of
> the contribution of one factor as opposed to another can only be
> attributed to the precise value of the marginal product and equated
> with the wage/salary paid if all conditions of perfect competition
> can be shown to prevail. Otherwise, you have power of one kind or
> another involved and that is certainly true for executive
> compensation.
>
> Sorry for repeating what is pretty basic but it sometimes seems to get lost.
>
> --Anne Mayhew
> ________________________________
> From: Societies for the History of Economics [[log in to unmask]] on
> behalf of Robin Neill [[log in to unmask]]
> Sent: Monday, May 06, 2013 9:17 AM
> To: [log in to unmask]
> Subject: [SHOE]
>
> Colleagues:
>
> There is an extensive literature on "excess executive compensation".
> Its roots go back to Berle and Means, at least, and perhaps to Veblen's
> "main chance", and Adam Smith's "unproductive labor".
>
> Can anyone refer me to an attempt to define for measurement, and
> to offer an empirical measurement of what might be termed "excess
> compensation for executives"? The definition "excess over transfer
> earnings" probably will not do in this case. One runs up against the
> circular argument, "They get what they are worth, and they are worth
> what they get."
>
> Robin Neill
>
>
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