This article proposes a model comprising company- and executive-specific variables as determinants of compensation for chief executive officers and reports an empirical testing of the model based on a sample of 170 service industry firms. An empirical test of the model was also conducted for banking and utility firms, the two major subgroups of the sample. An attempt was made to identify interindustry variations in the determinants of compensation for chief executive officers through separate investigation into banking and utility firms. Theoretical and practical implications of the research findings are discussed.
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