The purpose of this paper is to add to the small amount of empirical literature on managerial pay structure. I test several propositions of tournament models on a fairly rich data set. The data set is an unbalanced panel containing information about 2600 executives in 260 Danish firms (per year) during a four-year period. In addition to individual and firm characteristics, the data provide detailed information about the jobs and positions held by the executives. Thus, this allows me not only to analyse pay differentials (and changes therein) between individuals and job levels, but also to study the consequences in pay spread on company performance.
Evolution of Firms and Industries - International Perspectives, Research Report No. 223, 1997, p. 476-488