An Essay on Corporate Governance and Agency Conflicts

Modern corporations can reduce transaction costs,but create agency costs.As a concept developed to reduce agency costs in theory,corporate governance has several measurements in empirical research.Not all measurements have the same effect on agency costs.Based on related literatures,this paper analyzes the effect of corporate governance on agency costs in three dimensions: expression forms,behavioral subjects and its relationship with institutional environment.To discriminate the measurement of corporate governance and its effect on agency costs would be helpful to the hypothesis development,choice of proxies,and results explanation of related research.