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CEP occasional paper

Extreme Wage Inequality: Pay at the Very Top

We provide new evidence on the growth in pay at the very top of the wage distribution in the UK. Sectoral decompositions show that workers in the financial sector have accounted for the majority of the gains at the top over the last decade. New results are also presented on the pay of CEOs in the UK. We show how improved measurement of pay points to a stronger pay-performance link than previously estimated. This link is stronger, and more symmetric, for those firms in which institutional investors play a larger role.

Brian Bell and John Van Reenen

4 February 2013     Paper Number CEPOP34

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This CEP occasional paper is published under the centre's Growth programme.