Analyst coverage, internal pay gap and company performance: Evidence from Chinese stated-owned listed enterprises

Author

Yuqing Zhang ; Shiping Liu

Author_Institution

Sch. of Econ. & Manage., Nanjing Univ. of Sci. & Technol., Nanjing, China

fYear

2015

fDate

22-24 June 2015

Firstpage

1

Lastpage

6

Abstract

This study investigates the moderating effect of analyst coverage on the relationship between internal pay gap and company performance. Based on a sample of 2993 Chinese stated-owned listed enterprises from 2010 to 2014, we find that both executive pay gap and pay gap between executives and employees are positively related to company performance, which support the tournament theory. In addition, our results indicate that the positive effect of internal pay gap on company performance is stronger for companies with analyst coverage. Moreover, tournament incentives are weaker when there is greater forecast error or forecast dispersion.

Keywords

forecasting theory; incentive schemes; Chinese stated-owned listed enterprises; analyst coverage; company performance; executive pay gap; internal pay gap; tournament incentives; Boards; Companies; Dispersion; Government; Monitoring; Noise; Stock markets; analyst coverage; company performance; forecast dispersion; forecast error; internal pay gap;

fLanguage

English

Publisher

ieee

Conference_Titel

Service Systems and Service Management (ICSSSM), 2015 12th International Conference on

Conference_Location

Guangzhou

Print_ISBN

978-1-4799-8327-8

Type

conf

DOI

10.1109/ICSSSM.2015.7170171

Filename

7170171