Compensation and Competition for Talent: Evidence from the Financial Industry

Posted: 6 Jan 2015

See all articles by Mariassunta Giannetti

Mariassunta Giannetti

Stockholm School of Economics; Centre for Economic Policy Research (CEPR); European Corporate Governance Institute (ECGI); Swedish House of Finance

Daniel Metzger

Erasmus University Rotterdam (EUR) - Rotterdam School of Management (RSM); European Corporate Governance Institute (ECGI); London School of Economics & Political Science (LSE) - Financial Markets Group

Date Written: January 5, 2015

Abstract

We show that long-term compensation is associated with higher pay in the financial industry and this association is stronger in markets with high competition for talent. We argue that this evidence supports models of competition for talent based on retention motives.

Keywords: Competition for talent; Retention; Optimal contracts; Finance labor market

JEL Classification: G34, J31, J33, J41, J44, M52

Suggested Citation

Giannetti, Mariassunta and Metzger, Daniel, Compensation and Competition for Talent: Evidence from the Financial Industry (January 5, 2015). Finance Research Letters, Forthcoming, Available at SSRN: https://ssrn.com/abstract=2545313

Mariassunta Giannetti (Contact Author)

Stockholm School of Economics ( email )

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Sweden
+46 8 736 9607 (Phone)
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HOME PAGE: http://sites.google.com/site/mariassuntagiannetti/Home

Centre for Economic Policy Research (CEPR)

London
United Kingdom

European Corporate Governance Institute (ECGI)

c/o the Royal Academies of Belgium
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Belgium

HOME PAGE: http://www.ecgi.org

Swedish House of Finance ( email )

Drottninggatan 98
111 60 Stockholm
Sweden

Daniel Metzger

Erasmus University Rotterdam (EUR) - Rotterdam School of Management (RSM) ( email )

P.O. Box 1738
Room T08-21
3000 DR Rotterdam, 3000 DR
Netherlands

European Corporate Governance Institute (ECGI) ( email )

c/o the Royal Academies of Belgium
Rue Ducale 1 Hertogsstraat
1000 Brussels
Belgium

London School of Economics & Political Science (LSE) - Financial Markets Group ( email )

Houghton Street
London WC2A 2AE
United Kingdom

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