CEOs with large networks earn more than those with small networks; an additional connection to an executive or director outside the firm increases compensation by about $17,000 on average

From 2012... Engelberg, Joseph and Gao, Pengjie and Parsons, Christopher A., The Price of a CEO's Rolodex (May 2012). SSRN: http://dx.doi.org/10.2139/ssrn.1364595

Abstract: CEOs with large networks earn more than those with small networks. An additional connection to an executive or director outside the firm increases compensation by about $17,000 on average, more so for “important” members such as CEOs of big firms. Pay-for-connectivity is unrelated to several measures of corporate governance, evidence in favor of an efficient contracting explanation for CEO pay.

Keywords: Executive Compensation, Social Network

JEL Classification: G30