Entrepreneurial rewards and economic performance: an empirical study of the best small companies. (1st January 1999)

• Record Type: Journal Article
• Authors: Lee, Jooh; Lucius, Harold W.; McNeil, Steven A.
• Is Part Of: International journal of technology management. Volume 17:Number 7/8(1999)
• Page Start: 728
• Page End: 743
• Publication Date: 1999-01-01
• Subjects: CEO compensation -- accounting-based performance -- market-based performance -- SMEs; Technology -- Management -- Periodicals; 658.4062
• Languages: English
• ISSNs: 0267-5730

Abstract

This study attempts to examine a different spectrum of CEO compensation and economic performance in small- and medium-sized firms in America. Particularly, this study explores the directions and magnitudes of the relationships between compensation variables (cash-based short-term vs. long-term compensation) and economic performance (accounting- and market-based performance) after controlling for other interacting factors like CEO tenure, CEO stock ownership, and industry type. The researchers find that CEOs compensation in small- and medium-sized firms, in different types of industries, is positively linked to those firms' economic performance, particularly with respect to market-based performance. With respect to the control variables, only the CEO's stock ownership shows a significantly positive sign in determining the CEO's compensation.