Abstract The compensation gap between managers and employees of enterprises directly influences the fairness of macro income distribution.Based on the background that the private enterprises actively establish political connection with the government,this paper manually collects the data of political connections and empirically examines the effect of political connection on the compensation gap between managers and employees.It is found that the gap in politically connected enterprises is significantly bigger than that in non-politically connected enterprises and the difference is more as the institutional environment becomes worse.The results show that political connection is an important factor that influences the compensation gap between managers and employees,which is helpful to execute the “more fair” income distribution policy.
2015, Vol. 31 
