And that's easy to test. Remove everyone except the CEO, and see how things work out.

Bad argument. I could just as easily say "remove everyone except the ICs and see how things work out."

That would work and leave the company functioning well. Without the talking heads there is little need for management and IC domain experts and IC architects and IC sales and customer service will continue and leadership will naturally come from the rank and file.

It doesn't matter what "the truth" is, as long as the board (aka the owners) believe that the CEO's decision making is what led to the profits. The CEO's compensation is commensurate with this belief of cause and effect.

Maybe. It could well just be the market and luck, but it could be the CEOs decision. On the other hand, it's never because the line workers just started working harder. Think about being an early engineer at Amazon vs the same at another startup that never went anywhere. Those engineers did the same amount of work, but the difference is that Jeff Bezos was telling the Amazon engineers what to build. BTW I'm not making an argument that workers shouldn't share in the gains, just that people at the top are much more likely to be responsible for them.

> Those engineers did the same amount of work, but the difference is that Jeff Bezos was telling the Amazon engineers what to build

Particularly at early stage startups engineers are often responsible for a ton of innovation. It’s rarely exclusively top down instruction. Same goes for pretty much every company I’ve ever worked at. The CEO is not making every decision and coming up with every idea.