Abstract
Using multiple measures of attack proximity, we show that CEOs employed
at firms located near terrorist attacks earn an average pay increase of
12% after the attack relative to CEOs at firms located far from attacks.
CEOs at terrorist attack-proximate firms prefer cash-based compensation
increases (e.g., salary and bonus) over equity-based compensation
(e.g., options and stocks granted). The effect is causal and it is
larger when the bargaining power of the CEO is high. Other executives
and workers do not receive a terrorist attack premium.
Original language | English |
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Pages (from-to) | 379-398 |
Number of pages | 20 |
Journal | Journal of Financial Economics |
Volume | 135 |
Issue number | 2 |
DOIs | |
Publication status | Published - Feb 2020 |
User-Defined Keywords
- CEO labor market
- Compensation structure
- Executive compensation
- Nonmonetary compensation
- Terrorist attacks