Do CEOs deserve "star" compensation? The idea that CEO pay is driven by the invisible hand of market forces is a myth from which chief executives have long benefited, say Harvard professors Lucian Bebchuk and Rakesh Khurana
Like many other defenders of this phenomenon, Snow compared this trend to the soaring increase during this period in the compensation of other "stars," such as top baseball, basketball, and football players. Reports about the high pay of star athletes are often greeted with awe and approval rather than outrage. The rise of executive pay, its defenders claim, is no more problematic than the fact that, say, Red Sox slugger Manny Ramirez is paid much more than earlier stars like Ted Williams.
This article was provided with permission from Harvard Business School Working Knowledge.