Empirical Research On The Relation Between Agency Costs And Corporate Value Based On Ownership Structure

The company is the combo of the proprietorship capital and is composed of a series of ownership capital according to the contractual form; its most essential relation is the relationship of the ownership structure. Therefore, the ownership structure and the target of the companies` financing (maximization of the corporate value) have the inevitable affiliation, and the domestic and international scholars have carried on incessant investigations and studies. However, the relation between the ownership structure and the corporate value is indirect, the ownership structure develops corresponding governance structure, the governance structure and its function of the mechanisms decide the agency costs, and then affect the corporate value. In other words, the agency costs are just the direct decision factor of the corporate value. So only we study the correlation between the agency costs and the corporate value directly, we can provide the right policy suggestions for enhancing the corporate value. According to this, this paper studies the correlation between the agency costs and the corporate value from the angle of the ownership structure.The classical financial theories believed that the agency costs and corporate value presented negative correlation; the increasing of the agency costs caused the reduction of the corporate value. However, the sensitive degree of the corporate value to the agency costs is completely dissimilar in different ownership structures. The paper studies the influence of the ownership structure on the correlation between the agency costs and the corporate value from the proportion of the state-owned shares, ownership's concentration degree, ownership's check and balance degree, the proportion of the nonnegotiable shares these four angles, and carries on the detailed theoretical analysis towards them which builds solid foundation for the empirical analysis.The 2005 annual reports of Chinese listed companies have revealed the relevant information about the agency costs and corporate value, and the paper selects 513 listed companies as the sample of empirical analysis. The paper firstly makes use of the factor analysis method to calculate the sample companies` agency costs, and finds that the agency costs are mainly composed of inspiriting...