Executive Compensation and The Free Market System

Summary:

Many academic institutions, such as Cornell University and the University of North Carolina,

define an argument is a main idea, often called a claim, backed up with evidence that supports the idea.

The purpose of this paper is to analyze arguments made by Mr. R. Thomson about the excessive

executive pay and weather he succeeded in presenting a clear and convincing argument.

Introduction:

Mr. Roger Thompson is Editor of the HBS Alumni Bulletin. In his article “Excessive Executive Pay:

What’s the Solution?” Harvard Business School, he raises a critical economic issue about the relationship

between the recent economic meltdown and the excessive executive pay. He also proposes a set of

solutions to solve the current crisis and prevent another from occurring. Mr. Thompson does not think

that executive pay practice itself had a role in creating the financial meltdown. Furthermore, he thinks

the huge compensation plans with incentives led to the financial crisis. Mr. Thompson develops a solid

argument about the excessive executive pay by presenting evidence to support his claim, using

counterargument of others who disagree with his position, and by showing deep understanding of the

issue. He analyzes the issue from many perspectives: government perspective, Chief Executive Officers’

perspective, research perspective, and academic perspective.

Evidence and Counterargument

The author starts by explaining how the government got involved with the financial sector by

providing billions of dollars to large financial companies, such as AIG. The author claims that the White

House and congressional leaders are trying to shift the balance of power away from executive

management. The author...

... middle of paper ...

...d enhance the communications channels with the senior executives. I certainly agree with Mr.

Marshall, a research associate from the center for research on globalization, when he stared: “ultimately

everyone is responsible in a position of power. Together they have all accumulated this bad debt”.

(Marshall, 2010)

Works Cited

D. Teather: The Guardian, US executive pay goes off the scale. Retrieved Feb 10, 2011 from: http://www.guardian.co.uk/business/2005/aug/04/executivesalaries.executivepay2

Bolton, P., Mehran, H. and Shapiro, J. (2010): "Executive Compensation and Risk Taking”. Retrieved Feb 11, 2011 from http://www.newyorkfed.org/research/staff_reports/sr456.pdf

Andrew Marshall. Retrieved Feb 09, 2011, from http://www.globalresearch.ca/

Roger Thompson. (September, 2009). Excessive Executive Pay: What’s the Solution, Harvard Business School.