The Salary Gap Between Executives And Staff In Monopolies:Impact Factors And Enterprise Value

After decades of development, the economy of China has made remarkable achievements. Big change has also happened to the income of employees. The salary system plays a very important role of corporate governance to develop in the future. And it is also important to protect the profits of stakeholders.In the current emphasis on equitable income distribution, more and more people pay attention to the salary of monopoly companies. And how to restrict excessive salary in monopolistic executives and staff, as well as inhibit the further expansion of the salary gap has caused widespread concern among the community.Based on classical theories and previous studies, this thesis combines the theoretical research and empirical research methods, to find the impact factors of the inner salary gap of monopolistic companies that in the stock market. And then, do a further research on the consequence of higher inner salary gap.This thesis is divided into five parts. The first part is the introduction about the background, meaning, expected contribution, research methods and the framework. The second part is the theoretical basis of the thesis, reviewing the classical theories and the relevant articles to provide a theoretical basis for the further research. The third part is the descriptive statistics of the large samples. Firstly, it shows the panoramic view of the industry-wide salary status and development trends, and makes comparison of the monopolistic and non-monopolistic companies. Then it does the statistics from three angles, which are time, area and if the nation holds the stocks or not. The fourth part is the research design and the results. This thesis makes hypotheses on the companies’ basic features and the governance features, and builds multivariate regressions. After that, it does the further research about the consequences caused by salary gap. The last part of the thesis makes some recommendations to promote the policy, and then illustrates the defects and the possible directions of future research.The main conclusions are as below: The variables of area, the size of the enterprise, the board size and the management authority caused a positive impact on the salary gap between the executives and staff in the monopoly companies. And monopoly strength characteristics, the proportion of independent directors, the ownership concentration caused negative one. The capital structure does not make a significant effect on the salary gap. In the monopoly sample, internal pay gap caused the value of the enterprise decline, which fits the Behavior Theory.The main contribution of this thesis is the overall exhibition of the salary situation between the executives and employees in listed companies, and its development trend in recent years, and the comparative analysis between monopoly and non-monopoly enterprises. Through empirical research, it finds the impact factors that caused the change of the salary gap. Then it does a further research on the change of the enterprise’s value that caused by the higher gap of salary. It provides stakeholders some basis to judge their decisions.Limitations of this thesis are:First of all, the subjects are all listed companies that from the Shanghai Stock Exchange and Shenzhen Stock Exchange instead of all domestic business. And the definitions of the monopoly companies and the non-monopoly companies are subjective. So it is necessary to expand the range of the research and provide more objective data to measure the related variables in the future.