International Evidence on the Perception and Normative Valuation of Executive Compensation

Abstract

This article describes individuals' perceptions and normative valuations of executive compensation using comparable survey data for 27 countries for up to four different years. A majority of individuals believe that executives earn more than they deserve, but there is substantial variation in the perceived as well as the just level of executive compensation both within and across countries. The analysis further shows that subjective estimates of executive pay are associated with objective measures of executive compensation and income inequality, and that individuals' perceptions and normative valuations of executive compensation are associated with their more general political preferences.