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This article is by Pedro Matos, an associate professor of business administration at the University of Virginia ‘s Darden School of Business.

There has been a good deal of press coverage of the numbers of zeros in the paychecks of American chief executives. Many people, especially workers who have faced stagnant or lower wages in a tough economy, believe U.S. CEOs take home too much. This perception is usually supported with estimates by firms like Towers Watson, which conduct surveys showing that CEOs in the U.S. earn much more than their counterparts abroad. But is it true?

The difficulty in answering this question has come from a lack of good data on executive compensation across countries. But thanks to recently expanded disclosure rules, my co-authors and I were able to analyze data from more than 3,000 businesses across the U.S. and 13 other countries (mostly in Europe). In a recent paper we showed that the conventional wisdom that U.S. CEO pay is out-of-sync with the rest of the world is inaccurate or, at least, outdated.

A first cut of the data indicates that U.S. CEOs are paid twice as much as their international counterparts. But that is really comparing apples to oranges, for U.S. firms operate differently from their international counterparts, particularly in terms of corporate governance. After controlling for firm size, ownership, and board structure, all characteristics that often differ between U.S and international companies, the gap is reduced, with U.S. executives earning only a 26% premium. And when the analysis adjusts for the greater use of stock options and share awards in the U.S. the pay premium is reduced to an economically modest 14%. Maybe that would be a nice raise for a European CEO, but it’s not likely enough to induce him to cross the Atlantic and emigrate to the U.S.

U.S. firms lean toward higher institutional ownership and more independent boards. Typically this leads to a larger fraction of total compensation being awarded in the form of stock options and restricted shares. These equity payments only materialize in the following years if the executive delivers value to shareholders. Share ownership by families, the state, banks, or large investors is more prevalent in companies outside the U.S. and the presence of a large block-holder is associated with lower pay and reduced use of equity-based compensation. International CEOs may need less incentives because they have direct ownership as family members, or because the block-holder is heavily involved with day-to-day management.

So, some of the historic pay gap is due to these structural differences. Traditionally, international CEOs’ take-home pay is cash in hand rather than equity-linked. Although in the U.S. ownership is usually dispersed among many shareholders, institutional investors have been taking an increasing role. It’s a sign of good corporate governance when firms are monitored closely by institutional owners as well as independent board members. They tend to push to have CEO pay tied to shareholder performance. And that helps keep U.S. CEO pay from being excessive.

In other words, the world is flat for CEOs, or almost so. Our study finds that there is no huge difference in CEO pay among companies, regardless of their locations, if they compete in international markets. More and more, non-U.S. firms vie for the same capital, customers and talent as U.S. ones that operate globally. Companies looking to recruit executives in competition with equivalent U.S. firms are offering packages that are on par with U.S. standards.