Question

Why are CEOs paid so much? The ratio of CEO pay to the earnings of the average worker in their businesses has soared from around 38:1 in the early 1970s to over 700:1 today. Review the articles in Real World Micro on corporate behavior (especially 3.1, 4.4. 4.5), corporate governance (especially 4.1, 4.2, and 4.6), and consumer activism (especially 3.4). What is the goal of corporate managers? Do they pursue the public good and the good of their workers and consumers? What other concerns do they have and are these goals consistent with pursuing the public good? What checks are there on their actions, including their salaries? Are these checks effective, and what might be done to make them more effective?

Chapter	Article
3.1	“The 800-Pound Ronald McDonald in the Room”
4.4	“What’s Good for WalMart”
4.5	“How Private Equity Works – And Why it Matters”
4.6	“Corporate Cronyism: The Secret of Overpaid CEOs”
4.1	“What Are Corporations?”
4.2	“If Corporations Are People, What Kind of People Are They?”
3.4	“Campus Struggles Against Sweatshops Continue”

Answer 1