The thing about CEO pay rising after the information was made public was because it became a metric used by traders, so it started making financial sense to raise the CEO pay as it was thought to raise the company share price by more than the wage increase.
Of course this only works until someone matches your raise, then you have to raise again to keep the signaling going to the market and then the returns from this strategy rapidly diminish.
Now if the ratio was also public, then that would also become a market signal, but if you are a trader trying to gauge the health of a company then it should work in the favour of the employees, as if you are comparing two competing companies and trying to decide which one to bet on, if the CEO pay is the same and they are making similar profits, then the one with a smaller ratio will look like a much better bet.
edit - also, given that publicising CEO compensation can increase CEO compensation, why do you think that publicising employee compensation would reduce employee compensation?
And given you have not answered, why do you think that publicising employee compensation would reduce employee compensation?
You seem to be using the logic that the government tried something once and it did the opposite, so therefore all government policies do the opposite, rather than engaging with the potential outcomes of this specific idea.
I did not argue that publicising employee compensation would reduce employee compensation, that was someone else. Perhaps you confuse authors.
What's more, it will have the opposite consequence. In his book "Influence", Robert Cialdini wrote that making CEO pay public had the effect of raising exec pay across the board rather than check it, as the lawmakers had hoped.