2010•Economic SurveyRequires access
The Relationship between the Salary Mechanism and Agency Cost in Listed Family Business in Shanghai——A Research from the Perspective of Structural Difference
Jianlin Chen
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Abstract
Using classification research,the author explores the structural differences in the effect of salary mechanism on agency cost in different types of family business.The research finds:(1)the salary mechanism for higher executives has prominent effect on reducing agency cost in the listed family business.The yearly salary,share-holding proportion and salary gap of higher executives are negatively related to agency cost.(2)The classification research of the effect of salary mechanism for professional managers and family managers shows that the effect of the salary mechanism for professional managers in reducing agency cost is more obvious.(3)Classified by family self-interest tendency,the larger the coefficient variation of family control right and cash flow right,the weaker the effect of salary mechanism for higher executives on reducing agency cost.