The Effect of the Sarbanes-Oxley Act on CEO Pay for Luck Staff Working Paper 2008-20 Teodora Paligorova According to the rent-extraction hypothesis, weak corporate governance allows entrenched CEOs to capture the pay-setting process and benefit from events outside of their control – get paid for luck. Content Type(s): Staff research, Staff working papers Topic(s): Labour markets JEL Code(s): G, G3, G38, J, J3, J33, M, M5, M52