Table 2

No evidence that the cap on deductibility has affected CEO compensation: Various specifications

(1) (2) (3) (4) (5) (6) (7) (8)
VARIABLES
Post-2012 health insurance company -5423 -1221 -807.4 533.7 416.4 143.4 161.9 -1640
(3891) (3701) (3058) (2435) (3420) (2880) (3335) (3407)
Net income 0.405* 117.8*** 129.0*** 98.67***
(0.221) (0.888) (4.580) (8.027)
Sales 0.00499 -16.20*** -16.34*** -20.19***
(0.0296) (0.164) (0.178) (1.871)
Market value 0.0703** -4.903*** -4.981*** -4.683***
(0.0328) (0.0290) (0.0420) (0.245)
Difference in net income -0.263*** -0.294** -0.255** -0.175*
(0.0996) (0.118) (0.116) (0.102)
Difference in sales 0.117*** 0.0971** 0.0849** 0.100**
(0.0316) (0.0401) (0.0391) (0.0405)
Difference in market value 0.0246 0.0315 0.0313 0.0326
(0.0207) (0.0255) (0.0257) (0.0275)
Health insurance dummy 6517
(5001)
Net income (t=-1) 0.330 830.5***
(0.203) (2.440)
Sales (t=-1) -0.00699 28.32***
(0.0294) (0.351)
Market value (t=-1) 0.0558 -0.0191
(0.0437) (0.0233)
Difference in net income (t=-1) -0.0856 -0.121*
(0.0599) (0.0688)
Difference in sales (t=-1) 0.109*** 0.104***
(0.0410) (0.0324)
Difference in market value (t=-1) 0.0336 0.0434
(0.0600) (0.0456)
Sales (t=-2) 0.0114
(0.0290)
Market value (t=-2) 0.0312
(0.0489)
Difference in net income (t=-2) -0.0167
(0.121)
Difference in sales (t=-2) -0.0667
(0.0670)
Difference in market value (t=-2) 0.130***
(0.0306)
Retirement year dummy 1948** 2986***
(785.2) (1067)
Retirement year dummy (t=-1) -7624*** -7654***
(724.5) (724.8)
Constant 5147*** 14918*** 14554*** 16418*** 164371*** -916823*** 158177*** 205891***
(826.5) (427.9) (581.4) (672.2) (1826) (1238) (3039) (22399)
Observations 4188 3410 2966 2598 3410 2966 3410 3410
Number of firms 556 411 381 349 411 381 411 411
R-squared, within 0.0265 0.0408 0.0234 0.0198 0.127 0.125 0.143 0.169
R-squared, between 0.0260 0.229 0.237 0.348 0.317 0.250 0.329 0.329
R-squared, overall 0.0237 0.112 0.112 0.129 0.218 0.219 0.231 0.250

Notes: * p<.05; ** p<.01; *** p<.001. Model 1 provides a baseline for comparison and only includes dummy variables to designate the treatment group, all health insurers, and years. Model 2 does not include interactions or lags. Model 3 does not include interactions, and all variables are lagged by one year. Model 4 does not include interactions, and all variables are lagged by two years. Model 5 includes industry-specific interactions, but no lags. Model 6 includes industry-specific interactions, and all variables are lagged by one year. Model 7 includes industry-specific interactions, as well as a retirement dummy. Model 8 includes industry-specific interactions, as well as retirement and year dummies.

Source: Authors' analysis of data from Compustat's ExecuComp database.

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