Immigrant workers at companies with Republican-leaning CEOs end up making 8% less than those at firms led by Democrats.
SSRN · March 17, 2026 · 6316058
The Takeaway
While we usually think of corporate pay as being set by the market, this study shows that a CEO’s personal political ideology directly impacts the salaries of H-1B visa holders. This 'ideology tax' actually harms the companies in the long run, leading to lower innovation and higher financial risk.
From the abstract
We examine how executive political ideology shapes rank-and-file employee compensation. Using over 300,000 H-1B applications from 2010-2020, we document that firms led by Republican-leaning executives pay approximately 8% lower wages to H-1B workers than Democratic-leaning firms, after considering firm, job, and location characteristics. These findings align with agency theory and upper-echelons theory, which predict that managerial preferences influence organizational policies when discretion i