- Member of Political Economy of Distribution
By this expert
In this comment, we explain our objections to the SEC’s current formulation of the Pay Ratio Disclosure Rule on each of three grounds: the erroneous estimation of CEO pay; the unclear specification of the “median” worker; and the risk of normalizing a pay ratio that is far too high. Then we present the latest data on the remuneration of the 500 highest-paid CEOs in the United States, demonstrating the way in which the SEC’s measure of CEO pay that enters into the CEO-to-median-worker pay ratio tends to systematically underestimate actual executive pay.
Research funded by the Institute for New Economic Thinking has revealed that the SEC reports executive compensation using a formula that routinely undercounts it
Report to the Institute for New Economic Thinking on the statistical measurement and policy implications of the compensation of the highest- paid U.S. corporate executives
The company’s focus on stock buybacks to increase shareholder value is a reminder of why so much of the value created daily by millions of workers ends up in the hands of the billionaires