Excess Compensation Research Articles

The Gains and Losses of Cultivated Land Requisition–Compensation Balance: Analysis of the Spatiotemporal Trade-Offs and Synergies in Ecosystem Services Using Hubei Province as a Case Study

The cultivated land requisition–compensation balance (CLRCB) policy is an important policy implemented by China to address the reduction in cultivated land and ensure food security. Although this policy has alleviated the loss of cultivated land quantity, it has had complex and diverse impacts on ecosystem services. Taking Hubei Province as the study area, this research explores the impact of the implementation of the CLRCB on ecosystem services and simulates the changes in ecosystem services in the study area in 2030 and the impact of CLRCB on the interactions among various services. The results show the following: (1) from 2000 to 2020, Hubei Province achieved a balance in the quantity of cultivated land through excessive compensation but failed to reach the goals of balancing cultivated land yield and productivity. (2) During the requisition–compensation process, habitat quality decreased by 501,862, and carbon storage lost 1.3 × 107 t, indicating negative ecological impacts; soil conservation services increased by 184.2 × 106 t, and water production increased by 21.29.3 × 108 m3. Within the cultivated land requisition–compensation area, habitat quality and carbon storage, as well as soil conservation and water production, exhibited synergistic relationships, while the remaining pairs of ecosystem services showed trade-off relationships. (3) The simulation of ecosystem services in 2030 indicates that soil conservation and water production are highest under the natural development scenario, while habitat quality and carbon storage are highest under the ecological protection scenario, both of which are superior to the urban development scenario. Under the natural development scenario, the trade-off and synergistic relationships among various ecosystem services in the cultivated land requisition–compensation area remain unchanged, while these relationships change significantly under the other two scenarios. This study emphasizes that future CLRCB should not only focus on maintaining the quantity of cultivated land but also consider the comprehensive benefits of ecosystem services, in order to achieve sustainable land-use management and ecological conservation.

Analyzing the Impact of Executive Excess Compensation on Organizational Technological Innovation: Evidence from Bangladesh Pharmaceuticals & Chemicals Industry

This study analysing the impact of executive excess compensation (EEC) that is influencing the quality and efficiency of Organizational Technological Innovation (OTI). Using the Agency Theory, the Resource-Based View (RBV) and Upper Echelons Theory perspective in this study, the study has identified the compatibility of Executive Excess Compensation (EEC) with Organizational Technological Innovation (OTI) and then it has focused on investigation of the relationship between Executive Excess Compensation (EEC) with Organizational Technological Innovation (OTI) and for this quantitative analysis has been done by the usage of a structural equation modelling (SEM) approach by the usage of SmartPLS software. The findings regarding the compatibility of EEC with OTI suggest even a strong alignment between the executive compensation levels and the organization’s innovation capabilities. This indicates that companies offering the executive excess compensation which tend to demonstrate greater innovation efforts that is potentially driven by incentives linked to the compensation structures. Further, the analysis has revealed that higher levels of EEC were consistently associated with the overall greater technological innovation efficiency and to the technological innovation quality which is indicating on a robust relationship between executive pay and innovation performance. The results of this study ultimately provide empirical support for the notion that executive compensation plays a crucial role in case of driving innovation initiatives within organizations which is particularly in the pharmaceutical and chemical sectors of Bangladesh. The findings of the study can give insights for researchers, industry practitioners, policymakers, investors and for academics. However, the study is with some limitation and by acknowledging that further research is definitely needed to explore on the potential areas of improvement on this untapped or unique field.

Does carbon emission trading scheme inhibit corporate executives' pursuit of excess compensation? Evidence from a quasi-natural experiment in China

Carbon regulation, which affects corporate management's carbon reduction and related decisions, has the potential to influence corporate executives' pursuit of excess compensation. Using the pilot policy of the carbon emissions trading scheme (CETS) in China as a quasi-natural experiment, we examine the impact of this policy shock on corporate executives' excess compensation through data from listed manufacturing companies from 2007 to 2020. Our findings show that the executives' excess compensation of manufacturing companies in the pilot regions shows a significant decline owing to the policy shock of CETS, which is supported by a rich set of robustness tests. Furthermore, the mechanism tests indicate that reducing agency costs and stimulating employment demand are two channels for CETS to inhibit excess compensation of corporate executives, and that the factor marketization and the nature of firms' property rights play moderating roles in this inhibitory effect. Heterogeneity analysis indicates that the inhibitory effect of CETS on the excess compensation of corporate executives also varies depending on the differences in corporate governance characteristics. Overall, these findings provide evidence for the regulatory effect of CETS in the contract design of corporate executives' compensation and also provide empirical support for emerging economies to alleviate income inequality by achieving carbon equality.

Impression management, forward-looking strategy-related disclosure, and excess executive compensation: Evidence from China

We investigate whether overpaid executives in Chinese listed firms engage in impression management by using forward-looking strategy-related disclosure (FLSD) in management discussion and analysis (MD&A) narratives to justify their excess compensation. Using a sample of 8437 firm-year observations of Chinese nonfinancial listed firms from 2007 to 2016, we find a significant and positive relationship between executive overpayment and impression management in FLSD. This positive relationship is more pronounced in state-owned enterprises (SOEs) than non-SOEs. We also find that a higher degree of board independence, higher institutional shareholdings, auditors, analysts, and the introduction of the anti-corruption campaign could lower such a positive relationship. These findings suggest that impression management in FLSD is reduced when corporate governance is strengthened. We also find that CEO duality could enhance this positive relationship. Further examining how the market reacts to such impression management, we find an immediate positive and significant market reaction to such impression management at the time of the annual report filing, which could further mitigate the negative perceptions from stakeholders due to excessive pay. Such a positive market reaction is reversed over a longer time horizon, which supports the opportunistic/symbolic nature of impression management in FLSD.

The economics of coal phaseouts: auctions as a novel policy instrument for the energy transition

ABSTRACT Background: The combustion of coal, the world's most polluting form of energy, must be significantly curtailed to limit the global average temperature increase to well below 2°C. Since carbon pricing is politically constrained, alternative policies, such as compensating coal plant owners, for early closure are being considered. Methods: Germany is the only country to date to have implemented a reverse auction to give compensation payments for early coal retirement. We analyse the merits and demerits of Germany's policy, drawing comparisons with other countries that have phased out coal through other means. Results: While bilateral negotiations can lead to excessive compensation due to asymmetric information, a competitive auction can discover the true cost of closure and help allocate funds more efficiently and transparently. Germany's experience illustrates the practical necessity of adjusting auction design to ensure additionality, reduce the risk of gaming and manage the security of supply. Conclusion: While auctions have attractive properties in theory, in practice, their design must address these concerns to unlock the full benefits. Retirement auctions that deliver compensation payments can be a pragmatic policy option, particularly in countries where an incumbent coal lobby makes punitive measures such as carbon taxation hard to implement. However, where there is a concentration in coal plant ownership, auctions will not work and alternative policies, such as enhanced incentives for scrappage and repurposing of coal assets, could be used instead.

How do executive excess compensation affect enterprise technological innovation: Evidence from a panel threshold model of chinese biopharmaceutical companies

This study examines the levels of executive excess compensation (EEC) that stimulate the quality and efficiency of enterprise technology innovation (ETI). Using a behavioral agency perspective, we investigate how companies achieve superior ETI by providing sufficient incentives to motivate executives to perform to the best of their abilities. We use a panel threshold model based on a sample of Chinese-listed biopharmaceutical companies and find that: (1) providing an EEC between 0.0592 and 0.1907 significantly affects the promotion of ETI quality; (2) regarding ETI efficiency, executives generally do not receive the compensation that they deserve; and (3) the existing EEC has a weak negative impact on ETI efficiency, gradually disappearing as compensation increases. Heterogeneity analysis reveals that restricting EEC to the eastern area and strengthening the supervision of EEC in state-owned enterprises are effective measures for stimulating ETI. We advance the literature by providing guidance on compensation plans to companies in different regions.

Estimating the International Cocaine Market: A Novel Combination of Excess Compensation and Stochastic Frontier Analysis

Abstract Although there are different ways to estimate the value of the illicit drug markets, the main issue remains that one cannot estimate the unseized or floating value of drugs at the country- and international-level markets. This study applies a novel estimation method that combines excess compensation estimation (from the financial field) and stochastic frontier analysis (from the operations research field) to estimate the value of the international cocaine market in 2019. Our estimations show that in 2019, the unseized market accounted for 32.16 % of the total market of cocaine and was smaller than the ratio of 48 % in 2007, indicating that the effectiveness of countries in disrupting the illicit cocaine market has improved. More importantly, we show that improvement in dealing with money laundering risks could also help reduce the illicit market of cocaine since illicit cocaine/drug proceeds must be laundered before they can be used by criminal organisations.

The Effect of Ownership Structure and Board Characteristics on Excessive Compensation of Top-Level Management

The Effect of Ownership Structure and Board Characteristics on Excessive Compensation of Top-Level Management

Равенство удачи: развитие эгалитарных концепций справедливости в конце XX века

Since the publication of John Rawls’s Theory of Justice, the egalitarian tradition, which associates fair institutional structure with reaching equality in one aspect or another, has started to play a central role in academic discussions of the social justice problem. The article is devoted to the analysis of the evolution of egalitarianism of luck, which by the end of the 20th century has become the main direction in the framework of this tradition. The proponents of this direction in their argument depart from Rawls’s idea about the lottery of birth, according to which a game played by a fortune, being arbitrary from the moral point of view and affecting the distribution of resources in society, is unfair, and therefore should be compensated. Rawls’s approach to minimizing the role of luck in a fair distribution did not guarantee sufficient compensation for natural inequalities, assuming at the same time excessive compensation for “expensive tastes”. Trying to solve this problem, Ronald Dworkin distinguished between brute and option luck, using the model of the “veil of ignorance”, behind which the amount of fair compensation is determined. Further development of egalitarianism of luck at the turn of the 1980—1990s is associated with the names of Richard Arneson, Gerald Cohen, John Roemer and some other authors who made a number of amendments and changes to the concept of undeserved luck and proposed their own ways to neutralize its consequences for society. The arguments of proponents of luck egalitarianism at the end of the 20th century aimed at strengthening the role of an individual’s freedom of choice and implantation of the ethics of responsibility into the theory of social justice. At the same time, the interpretation of luck as a true “currency of equality” made the question of fair distribution conditional upon the consensus on the limits of human capacity for systematic cultivation of virtues and the scope of individual responsibility for one’s own destiny.

Recruitment of Underrepresented Groups into the AHEAD Study: Strategic plan of Action

AbstractBackgroundTo ensure that therapies are applicable for all groups, ethnic/racial diversity in Alzheimer’s disease (AD) clinical trials is an ethical imperative. Toward this goal, we developed a recruitment model founded on 1) building trust by providing accurate and transparent information, and 2) using culturally sensitive approaches to address legitimate concerns. Our ultimate goal is to empower individuals from under‐represented groups (URG) to participate in AD research.MethodOur group focuses on recruitment of racialized groups. Using a multistep approach (figure1), we established partnerships and created community advisory boards (CABs) comprised of leaders who effectively advocate for community needs. Research projects are presented to the CABs to determine alignment with community needs. Assessments with community leaders and advisory networks help identify opportunities to fulfill community needs. Recruitment of African Americans (AA) into the AHEAD study, a study assessing the recently approved monoclonal antibody, lecanemab in participants with preclinical AD, began by presenting the project to the Black Leaders of Brain Health (BLBH) CAB. Incorporating their input into our approach, we will structure community talks and events in a culturally appropriate manner in discussions with the larger AA community. Example, we utilized a questionnaire at an event to introduce AA participants in a biomarker study to the AHEAD study (figures 2 & 3).ResultFeedback received from BLBH includes advocating to funders, including the NIH to fund research that reflects inclusivity and diversity. BLBH recommended building URG voices into study design by having a diverse scientific team and hiring community members to collect data. Additionally, rather than excessive compensation, researchers should speak to the study benefits both for the individual’s and the community’s health. Finally, BLBH members emphasized the need to include hopeful messages and advice to improve health, rather than merely pointing out that AA are most likely among racial groups to have the disease.ConclusionRecruitment models involving trust building and partnerships with groups consisting of community members of URG will be mutually beneficial for both the health researcher and the communities that they serve. This may serve as a means to tip the scale toward increased participation by URG in biomedical research.

Large eddy simulation of shock-combustion-film interaction at hydrogen injection in a model scramjet combustor

Supersonic film cooling, which utilizes fuel onboard, is a promising method for protecting the wall of a scramjet combustor from intense heat and friction loads during high-speed flight. Large eddy simulation (LES) is conducted to study the coupled interactions among shock, combustion, and film. First, reference solutions for individual effects of shock and combustion on film performance are computed. Then the coupled effects are analyzed based on the reactive hydrogen film impinged by an oblique shock at a deflection angle of 2° The results show that the incident shock will enhance the transport processes after the impingement point by an increased turbulence production in the separation bubble. On the contrary, boundary layer combustion has the effect of constraining the transport processes in the mixing layer due to the low-density region caused by thermal expansion. This leads to a decrease in the mixing rate and wall friction. Although the heat flux transported to the film is also reduced by combustion, the wall temperature still increases due to the excessive compensation of heat from intense endothermic chemistry. Besides, the boundary layer combustion of hydrogen film exhibits self-limited characteristic since the mixing process is further delayed under combustion circumstance. Therefore, an incident shock will break the mixing bottleneck of the boundary layer combustion, leading to a more intense reaction with a more wrinkled flame front. The current findings indicate that the additional gaining of cooling and friction reduction performance is exclusive, but also point out the direction for simultaneous improvement of the two performances.

Are ESG performance-based incentives a panacea or a smokescreen for excess compensation?

PurposeThis paper aims to examine how the use of environmental, social and governance (ESG) incentives intersects with top management power and various corporate governance mechanisms to affect excess annual cash bonus compensation.Design/methodology/approachThe authors use a novel artificial intelligence (AI) technique to obtain data about ESG incentives use by firms in the S&P 500. The authors test the hypotheses with an endogenous treatment-regression and a contrast test.FindingsWhen the top management team has power and uses ESG incentives, there is a 32% reduction in excess annual cash bonuses implying ESG incentives are an effective corporate governance tool. However, nuanced analyses reveal that when powerful management teams with ESG incentives are from environmentally sensitive industries, have a corporate social responsibility (CSR) committee or have long-term view institutional shareholders, they derive excess bonuses.Practical implicationsStakeholders will better understand management’s motivations for the inclusion of ESG incentives in executive compensation contracts and be able to identify situations which require closer scrutiny.Social implicationsGiven the increased popularity of ESG incentives, society, regulators, boards of directors and management teams will be interested in better understanding when these incentives might be effective and when they might be abused.Originality/valueTo the best of the authors’ knowledge, this study is the first to examine the use of ESG incentives in relation to excess pay. The authors contribute to both the CSR and executive compensation literatures. The work also uses a new methodological technique using AI to gather difficult-to-obtain data, opening new avenues for research.

Corporate social responsibility and abnormal executive compensation

PurposeThe authors examine the association between corporate social responsibility (CSR) and abnormal executive compensation. The authors hypothesize that socially responsible firms are more likely to pay their executives at a level that is in line with economic determinants.Design/methodology/approachUsing the expected compensation model developed by Core et al. (2008), the authors test our hypothesis using a large sample of US public companies.FindingsThe authors find that CSR performance is negatively associated with how much executive compensation deviates from the expected level. The authors further examine whether CSR performance is associated with excess compensation or inadequate compensation and find that socially responsible firms are less likely to pay their executives either excessively or inadequately.Originality/valueThis study provides evidence on the association between CSR performance and abnormal executive compensation, especially how CSR is associated with inadequate compensation, an area that has been largely overlooked by the literature.

Board refreshment and director excess compensation

This study investigates the relationship between board refreshment and director excess compensation, which is often perceived as a sign of dysfunctional board culture. Using a composite board refreshment index (BRI) comprised of seven director refreshment characteristics, I show that board refreshment increases director compensation for undercompensated directors. However, for overcompensated directors, board refreshment has an adverse effect on excess compensation. This association is primarily driven by five out of the seven refreshment characteristics. Overall, these findings suggest that board refreshment may play an important role in aligning director compensation with efficient levels.

｢공익사업을 위한 토지 등의 취득 및 보상에 관한 법률｣ 상의 사업인정의제 관련 중앙토지수용위원회의 조건부동의 시의 법적 쟁점 및 그 해결

On February 24, 2002, the National Assembly integrated ‘the Land Expropriation Act’ and ‘the Special Act on the Compensation for Loss of Public Land’ and enacted ‘the Act On Acquisition Of And Compensation For Land For Public Works Projects (“the Land Compensation Act: LCA”).’ Nevertheless, the LCA was criticized for not protecting individual property rights because (quasi-)project approval was not able to guarantee ‘public needs.’ As a result, the LCA was amended in 2015 and 2018. The Minister of Land, Infrastructure and Transport(“LIT Minister”) and authorities of quasi-project approval should have a consultation with Central Land Tribunal(“CLT”) during (quasi-)project approval procedures. However, several unexpected problems began to arise, particularly when CLT gives a conditional consent for quasi-project approval after consultation. A conditional consent for quasi-project approval requires a public project operator to achieve much more (which is 75 percent than than 50 percent of public project area which is required as consultation acquisition rate. The proviso of a conditional consent allows a public project operator to apply for CLT hearing. Some local land tribunals (“LLTs”) intend to establish administrative rules for excessive compensation demands. However, LLTs are not authorized to make those rules. And those rules are directly against the landowners who are subject to taking. LLTs may make an adjudication of the Land Tribunal only on cases in which 75 percent consultation acquisition rate has been achieved. If the rate was not met at the time of application but was achieved during LLTs’s process, LLTs should make an adjudication to dismiss. If not, applying for land expropriation could be used as a means of threatening landowners to consult. However, landowners could request a public project operator to apply for adjudication of the Land Tribunal, regardless of whether or not the acquisition rate is achieved.

Optimizing the Correction of Depressive Disorders in Patients with Primary Hypothyroidism

IntroductionPopulation recent studies have shown that most patients with endocrine pathology suffer from at least one of the three DCPR syndromes: irritable mood, demoralization (despair), persistent somatization. The thyroid gland is a unique organ among the glands of internal secretion, in the pathology of which non-psychotic mental disorders are extremely common. Therefore, the use of a complex, integrative, systemic approach in the examination of patients with thyroid pathology should be the basis of planning the strategy and tactics of the treatment program for such patients.ObjectivesWe examined 132 patients with primary hypothyroidism.MethodsWe used psychopathological method and an adapted methodology for assessing typologies of psychological defence. It was the method of Robert Plutchik adapted by L.I.Wasserman, O.F.Eryshev, E.B.Klubova for assessment of the next mechanisms of defense: negation, projection, regression, displacement, repression, intellectualization, reactive formation, compensation.ResultsIn 108 patients, who made up 81.12% of the total number of investigated, various forms of non-psychotic mental disorders were detected, among which 23 patients (12.04%) had an anxiety-depressive syndrome, and astheno-depressive syndrome (32.41%).It was established that excessive compensation, projection, reactive formation formed a tendency to increased self-control, to analysis and introspection, self-justification, isolation, which in general influenced the structure of the astheno-depressive syndrome. Insufficient reactive formation, displacement, and excessive intellectualization in a complex contributed to the formation of subjective feelings of anxiety and fear in patients, led to the avoidance of problematic situations, unnatural slowness with behavioral manifestations of anxiety, therefore influenced the structuring of anxiety and depressive disorders at the same time. Thus, significant connections have been established between the intrapsychic level of functioning and the formation of astheno-depressive and anxiety-depressive disorders, which should be used in the planning of psychotherapeutic and psychocorrective measures.ConclusionsThis approach ensures that endocrinologists and general practitioners master the simplest skills for providing psychocorrective care to patients with depressive disorders. It includes the application of elements of rational psychotherapy, in order to form a sense of control over their own condition and the ability to master negative influences, which contributes to stabilization their general condition and improvement of the quality of life. So medical care to such patients should focus on early diagnosis and correction of nonpsychotic mental disorders. Both medications and psychological influences should be used in the treatment of such patients.Disclosure of InterestNone Declared

A Framework of Excessive Executive Compensation – An Obscured Breach in Corporate Governance Agency Contract

Excessive executive compensation is tantamount to a breach of agency contract. There are two main problems with excessive executive compensation: excessive compensation is stealing from a shareholder’s standpoint; excessive executive compensation is demoralizing to the other workers in the organization. Purpose. This paper aims to provide a conceptual framework of the antecedent and postcedent of excessive executive compensation. Approach. The paper inclines on agency theory and the attendant principal-agent contract. The paper follows a critical deconstruction approach, culminating in the development of an original conceptual framework. Finding. Through a critical deconstruction of agency theory postulation of optimal agent’s response to corporate compensation structure, it emerges that this postulation may not hold in all instances given that gargantuan compensation structure has a high propensity to nurture irresistible executive financial misdemeanours to inflate profit or share price, which are the performance index of reaping the excessive compensation. This incubates ancillary agency costs to the detriment of the principal and corporate survival. Theoretical and practical value. The paper offers insight into corporate governance strategy for accounting and business law theory and practice in university business schools and for further research. In addition, corporate boards may draw insights from the theory developed in this paper, which portrays the antecedents and postcedents of executive excessive compensation. This theory will catalyse debate and rethinking of corporate compensation policies within the boards of directors. The paper offers an original contribution to the contentious agency cost issues by developing a conceptual framework of the antecedent and postcedent of excessive executive compensation – depicting obscured additional agency costs.

Research on the Game Mechanism of Cultivated Land Ecological Compensation Standards Determination: Based on the Empirical Analysis of the Yangtze River Economic Belt, China

The ecological compensation of cultivated land could also be called paying for the ecological service of cultivated land. It means that based on comprehensive consideration of the cost of the protection of the cultivated land and the value of the ecological service, the benefited area would implement the ecological compensation to the damaged area to motivate the actors of the protection behavior to protect the cultivated land better. A fair and reasonable cultivated land ecological compensation mechanism is critical in motivating cultivated land protection subjects’ active participation in cultivated land protection. However, most of the currently measured cultivated land ecological compensation standards are only determined from the perspective of a single interest, ignoring the participation and negotiation of cultivated land protection stakeholders, resulting in insufficient pertinence, low compensation standards, and low compensation efficiency. Therefore, by introducing a market mechanism, this study constructs a non-cooperative bargaining model and solves three stages of the game equilibrium solution under the condition of comprehensive consideration of interests of farmland ecosystem service providers and consumers. In this study, the Yangtze River Economic Belt is taken as the research area to provide empirical analysis of a cultivated land ecological game compensation standard between the subject and object of cultivated land ecological compensation in the area. The study found that, under the ecological compensation standard for cultivated land determined by the bargaining game, the cultivated land ecological compensation subject and object in the area meets the “KaldorHicks” resource allocation criterion, and the standard can take into account the interests of both parties. Meanwhile, the river basin horizontal ecological compensation quota determined by the game standard will neither cause a financial dilemma in the payment area due to the excessive compensation quota, nor financial “windfall gain” in the compensated area due to ecological finance transfer of cultivated land. The cultivated land ecological compensation standard based on the game between the two parties is reasonable and accurate for the cultivated land ecological compensation object, which not only functions as an economic incentive, but maintains long-term effectiveness of policy. Therefore, it is necessary to actively promote the determination of ecological compensation standards based on negotiation means, and to establish a sustainable ecological protection compensation mechanism involving government predomination, social engagement, and market-oriented operations, to drive marketization of cultivated land ecological compensation.

Executives' overseas background and corporate green innovation

AbstractThis study examines the impact of executives' overseas background on corporate green innovation and the possible adverse selection problem in attracting overseas‐returned executives to high‐polluted cities. Based on the data from Chinese listed companies between 2002 and 2018, we empirically find that executives' overseas background has a significantly positive impact on corporate green innovation. In addition, it is found that air pollution results in the loss of overseas‐returned executives, while the effect of executives' overseas background in stimulating corporate green innovation is more prominent in high‐polluted cities, indicating that high‐polluted cities should make more efforts to attract returnees. Therefore, we further explore the policy influence of executives' excess compensation and find that excess compensation in high‐polluted cities weakens the positive impact of executives' overseas background, although it increases the effectiveness of importing overseas‐returned executives, which means that the adverse selection caused by excess compensation in high‐polluted cities is non‐negligible.

Examining the Effects of the Tax Cuts and Jobs Act on Executive Compensation*

ABSTRACTAs part of the Tax Cuts and Jobs Act (TCJA), the US Congress repealed a long‐standing exception that allowed companies to deduct executives' qualified performance‐based compensation in excess of $1 million. The purpose of this study is to examine whether Congress achieved its stated objective of reversing a shift in executive compensation away from cash compensation and toward performance pay, which Congress believed led executives to focus on short‐term results rather than the long‐term success of the company. Across a battery of tests, including a difference‐in‐differences design that exploits the staggered time‐series implementation of the deduction limit, we find evidence compatible with the new deduction limit having no effect on executives' salary, performance pay or total compensation, inconsistent with Congressional intent. Our results suggest that taxes are not a first‐order effect of executive pay and that tax regulation could be relatively ineffective at curbing executive compensation.