Political Relations, Executive Pay And Corporate Value

Political relations is a worldwide problem, Whether the stock market is developed countries with sound legal system, or the stock market of developing countries is immature, imperfect legal system, political relation is a common phenomenon. As an emerging and transitional market, China is similar to the transition economies, the Chinese regime reflect the characteristics:the legal system is not perfect, the government against the phenomenon of enterprise property rights, private enterprises affected by the policy of discrimination. State-owned enterprises and the government there is no "natural" Contact In this context, private enterprises from scratch, from weak to strong growing development means that there must be some internal mechanism to promote this development, one of which is the political relations traditional Chinese culture, the importance of "relationship" over the Western countries, the political nature of the relationship is a "relationship" for loans to private enterprises financing, tax incentives, government subsidies to facilitate, and these are reflected in day-to-day operations of the enterprise be interested in enterprise value on what impact it? Judging from the executive compensation, executive political relations will affect the level of remuneration? Remuneration as political relations executives and government departments to build the relationship between access to resources so as to enhance the value of the company’s power? These issues is the need to study in this article.Based on this, formed from the political relations of private enterprises and the motivation to start the analysis by rent-seeking theory and delegate agency theory analysis of the relationship between the political relationship between executive pay and the value of the company three to private enterprises as samples, select the private2005-2010sample panel data multiple linear regression, in order to study the relationship between the three The results showed that:(1) the value of the company and the executive political relations are a positive but not significant impact; distinguish between the chairman and general manager of political relations, the chairman of the political relations was a significant positive correlation between the value of the company; distinguish between the type of political relations chairman of the board, on behalf of the class and the political class and political relations will produce a positive correlation between the value of the company, while the general manager has on behalf of the class and political relations and would be the value of the negative correlation.(2) the existence of political relations between executive pay significant positive correlation; distinguish between the chairman and general manager of political relations, political relations between the general manager of higher pay; distinguish between the type of political relations, representing the class of political relations have high tube pay significantly positive, while the government class political relations executives but then pay significantly negative.(3) The political relationship between executive pay and company value of the coefficient is positive but not significant; distinguish between the chairman and the general manager, the chairman of the remuneration of political relations can decrease the value of the company; distinguish political relations type, on behalf of the executive compensation a positive relationship between the value of the company but not significant, while the government executive pay and the value of the company was not significant negative relationship.