There is actually a reason for high CEO pay

Macron has decided - in the fits of an election campaign of course - that there should be European Union limitations upon executive pay. We in Britain should, of course, welcome such actions by the remnant-EU if we are to be selfish - economic performance there will decline and at least some companies are likely to move to here as a result.

No, really, think through this for a moment. Assume that it really is true that CEOs gain high pay simply because they hoodwink everyone else. So, they’d move their corporate domicile in order to be able to continue to hoodwink everyone else, wouldn’t they? Now lift that untrue assumption and think about reality for a moment.

Is there a reason for high CEO pay?

Though Japanese firms benefit from a high-quality workforce and invest in R&D as much as their US counterparts, they fall behind US firms in terms of their earning power. This column suggests that corporate structures in the two countries could be an explanation for this phenomenon. The findings indicate that CEOs of US firms aim to maximise profits, whereas CEOs of Japanese firms prioritise long-term corporate survival.

Japanese firms, famously, pay their CEOs less than the Americans do - 90% less by some measures. That very pay difference is what changes those incentives and thus performance.

So, err, perhaps not, eh?