Open AccessBankers and Their Bonuses
Author(s) -
Bell Brian,
Van Reenen John
Publication year - 2014
Publication title -
the economic journal
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 4.683
H-Index - 160
eISSN - 1468-0297
pISSN - 0013-0133
DOI - 10.1111/ecoj.12101
Subject(s) - boom , earnings , position (finance) , financial crisis , earnings per share , economics , transparency (behavior) , distribution (mathematics) , financial system , business , monetary economics , labour economics , finance , macroeconomics , political science , mathematical analysis , mathematics , environmental engineering , law , engineering
We analyse the role of financial sector workers in the huge rise of the share of earnings going to those at the very top of the pay distribution in the UK . Rising bankers’ bonuses accounted for two‐thirds of the increase in the share of the top 1% after 1999. Surprisingly, bankers’ share of earnings showed no decline between the peak of the financial boom in 2007 and 2011, three years after the global crisis began. Nor did bankers’ relative employment position deteriorate over this period. We discuss proposed policy responses such as transparency, bonus ‘clawbacks’, numerical bonus targets and tax.