Ridge, Jason W. and Aime, Frederico and White, Margaret A.
(2015)
When much more of a difference makes a difference: Social comparison and tournaments in the CEO's top team.
Strategic Management Journal, 36 (4).
pp. 618-636.
ISSN 0143-2095
Abstract
We integrate the seemingly contradictory theoretical predictions of behavioral and economic
perspectives about the relationship between pay disparity and firm performance and show that
tournament and social comparison theories are more supplementary than contradictory in nature.
Our results show that high levels of firm performance will be found around either meaningfully
low or meaningfully high levels of pay disparity. Additional findings indicate that this curvilinear
relationship is weakened in the presence of both an heir apparent and high CEO power, and
strengthened when top management team members are more eligible as CEOs. These findings
suggest that factors that increase or inhibit social comparison or tournament perceptions among
TMT members play a role in the strength of the curvilinear relationship between pay disparity
and firm performance.
| Item Type: |
Article
|
| Keywords: |
pay dispersion; social comparison theory;
tournament theory; CEO heir apparent; CEO duality; |
| Academic Unit: |
Faculty of Social Sciences > School of Business |
| Item ID: |
11275 |
| Identification Number: |
https://doi.org/10.1002/smj.2227 |
| Depositing User: |
Margaret White
|
| Date Deposited: |
14 Oct 2019 16:22 |
| Journal or Publication Title: |
Strategic Management Journal |
| Publisher: |
John Wiley & Sons, Inc |
| Refereed: |
Yes |
| URI: |
|
| Use Licence: |
This item is available under a Creative Commons Attribution Non Commercial Share Alike Licence (CC BY-NC-SA). Details of this licence are available
here |
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