| According to traditional theory of capital structure, when a corporation are making financing decision, it would first turn to self-finance, and then is outside financing. And debts financing is prior to equity financing when in outside financing. Main reason of this result is from the consideration of cost, because inside-financing is the most inexpensive, then is debt financing, while equity-financing is the most expensive one. The structure of financing would influence the capital structure directly. Corresponding to traditional financing structure, the proportion of debt will be high while that of equity low.Dose the reality conform to theory or not? The answer is it depends, depends on countries and industry. There are many a literary about the comparison of capital structure. In this paper, we use multi-national companies from different countries as sample to make the comparison, meanwhile we also analyze the reason of these differences.The results shows that china’s multinational companies like to find outside finance, and they prefer equity finance to debt finance.Then, we analyze the reason of the differences, and the innovation of this paper is take the capital structure as a result of game, we add the agency cost of main shareholder and other shareholders as the reason of the capital structure differences. Because, in china, the proportion of main shareholder is high and meanwhile it is also the management, therefore the main shareholder has strong incentive to financing from other shareholders. We use the proportion of main shareholder as an independent variable and after controlling other factors, we find that the equity ratio for a company is positively related with the proportion of main shareholder. |
