The expansion of available data for research has transformed empirical labor economics over the past generation. This paper briefly highlights some of the changes and describes a few examples of papers that illustrate the advances. It also documents the changing ways data have been used in the Journal of Labor Economics over the past 30 years, including a trend toward a higher fraction of papers using any data and, among those papers using any data, a higher fraction using nonpublic data, a higher fraction using international data, and more frequent use of multiple data sources. Finally, this paper describes work that came out of the recent Princeton Data Improvement Initiative—a program that considers and furthers improved data collection.

Is executive compensation influenced by the composition of the board of directors?About 8% of chief executive officers (CEOs) are reciprocally interlocked with another CEO-the current CEO of firm A serves as a director of firm B and the current CEO of firm B serves as a director of firm A. Roughly 20% of firms have at least one current or retired employee sitting on the board of another firm and vice versa.I investigate how these and other features of board composition affect CEO pay by using a sample of 9,804 director positions in America's largest companies.CEOs who lead interlocked firms earn significantly higher compensation.Also, interlocked CEOs tend to head larger firms.After controlling for firm and CEO characteristics, the pay gap is reduced dramatically.However, when firms that are interlocked due to documented business relationships are considered not interlocked, the measured return to interlock is as high as 17%.There also is evidence that the return to interlock was higher in the 1970s than in the early 1990s.

This paper examines the connection between layoffs, executive pay, and stock prices. Firms that announce layoffs in the previous year pay their CEOs more, and give their CEOs larger percentage raises than firms which do not have at least one layoff announcement in the previous year. However, the likelihood of announcing a layoff varies dramatically along other dimensions, for example firm size, which are also correlated with CEO pay. Once firm-specific fixed effects are controlled for, the CEO pay premium for laying off workers disappears. In addition, there is a small negative share price reaction to layoff announcements.

We study whether boards of directors concentrate on performance near compensation decision times rather than providing consistent incentives for chief executive officers (CEO) throughout the fiscal year. We show empirically that managers can profit by moving sales revenue among fiscal quarters. Though this may suggest that boards use short-term trends when determining rewards, we find evidence consistent with boards tying pay to recent sales growth so as to use the best information about future performance. We also find that the timing of profits throughout the year does not affect CEO pay, which may suggest that smoothing firm income is important to CEOs.