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05/27/2006

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Arun Khanna

Re: "Several of you confused substantial deviations between compensation and performance during any year in some companies with what determines why average CEO pay increased so much over time-six fold, in fact. That is the main problem I address. Unless the frequency of mismanagement grew over time, the evidence on mismanagement for any year cannot explain the growth in pay over time."

Even if frequency of mismanagement does not increase, higher potential for mismanagement over time could explain the growth in CEO pay.

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