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Real Effects of the CEO Pay Ratio Disclosure Mandate

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2025-06-09
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Abstract

I investigate the real effects of Section 953(b) of the Dodd-Frank Act, which requires that firms disclose the ratio of total CEO compensation to the median employee compensation. Using a difference-in-differences framework and granular data at the establishment-level, I document that Section 953(b) leads to employment cuts. Employment cuts are particularly severe in firms that have high CEO pay, in states that have weak labor protection laws, and in establishments that are part of the firm’s noncentral operations. These employment cuts are accompanied by an increase in spending on information technology, suggesting that firms are changing their mixture of inputs rather than downscaling their operations.

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Description

55 pages

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Date Issued

2021-05

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Keywords

CEO Pay Ratio; CSR; Disclosure Mandate; Dodd-Frank Act; Employment

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Employer

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Union Local

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Number of Workers

Committee Chair

Zuo, Luo

Committee Co-Chair

Committee Member

Yeung, Eric
Forman, Chris
Campello, Murillo

Degree Discipline

Management

Degree Name

Ph. D., Management

Degree Level

Doctor of Philosophy

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Government Document

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Attribution-NonCommercial-NoDerivatives 4.0 International

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dissertation or thesis

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