November 2017
Comment
Journal of Accounting & Economics

Discussion: Do Common Inherited Beliefs and Values Influence CEO Pay?

Format:Print

Abstract

The origin of preferences is something we know strikingly little about in economics. Given the central importance of preferences, we have not invested nearly the time we should into this concept. And so, as an overarching research direction, I am heartened by the push of the paper. That being said, while I believe the authors have done much throughout the writing and revision of this paper, I do believe a number of gaps remain. These gaps vary in their severity—from further explorations that could have better established a potential mechanism, to fundamental gaps that impact inference and bottom-line takeaways. I’ll split the discussion into three main sections that encompass what I believe to be three broad categories of these gaps: 1. Two-sided matching. 2. External validity. 3. Lack of consistency across decisions.