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Bivens and Mishel (2013) address the larger issue of the role of CEO compensation in generating income gains at the very top and conclude that there are substantial rents embedded in executive pay, meaning that CEO pay gains are not simply the result of a competitive market for talent. We draw on that analysis to show that CEO compensation grew far faster than compensation of other highly paid workers over the last few decades, which suggests that the market for skills was not responsible for the rapid growth of CEO compensation. To reach this finding we employ Kaplan’s own series on CEO compensation and compare it to the incomes of top households, as he does, but also compare it to a better standard, the wages of top wage earners. 4 We update Kaplan’s series beyond 2010 using the growth of CEO compensation in our own series. This analysis finds, contrary to Kaplan, that compensation of CEOs has far outpaced that of very highly paid workers, the top percent of earners.
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