Firm Growth and CEO-TMT Pay Disparity

This paper examines how firm growth, and its decomposition into acquisitive and organic growth, can serve as an antecedent to the disparity in pay between the CEO and other top management team (TMT) members. Drawing on tournament theory, we argue that acquisitive and organic growth strategies have different effects on CEO-TMT pay disparity. We find that acquisitive growth, measured through the number and size of acquisitions, increases CEO-TMT...