The Theory Of Financial Structure And Research On How To Distribute The Authority In The Enterprises Based On Human Capital

The theory about financial structure has been developed for more than 50 years. The famous MM' theorem published in 1958, this theorem encouraged many economists to study capital structure.I think that the theory of financial structure accords to firm theory. The article have two lines, the first line studies financial structure from MM' theorem; the second line studies firm theory from neo-classical model. The hypothesis of MM' theorem is so strictly that its conclusion doesn't exist in the real world. Agency theory found that the incentive problem existed in firms' affected financial structure. Many economists such as Hart, etc, developed a financial structure model based on control rights. The model answered where the authority in firm came from. But in modern economics new firm based on human capital developed very fast, the above two theories cannot explain this new phenomenon. Rajan and Zingales studied the phenomena, and put forward a new firm theory called power theory. This theory explains what it is.In this article the writer develop a financial structure model, explain why entrepreneur human capital is important. Its conclusion says, in new firms, it is right that labor hires capital.