An Empirical Research On Management Incentive And Cost Stickiness

With the ever-changing economic situation, China has been from the time of low cost to the time of high cost, and for the manufacturing powerhouse like China, the cost has almost been the lifeblood of enterprises, so it is very important for an enterprise to control the costs if it wants to get profits and survive in this environment. Before to control the costs, we should make clear that what the factor and how it affects the cost. In the traditional cost behavior theory, it considers tiiat the costs can be divided into fixed cost, variable cost and mixed cost. And it also considers that the total costs maintained the basic linear relationship with the volume of business. The formation of this viewpoint is built in an ideal state, without considering the impact of the corporate management and other factors.In recent years, with the study of cost behavior, cost and volume is not completely linear relationship, between the cost behavior in management accounting assumptions challenged. Under the study of the large numbers of scholar in recent years, it is found that the cost is sticky. The Cost Stickiness refers to the proportion that the enterprise’s costs reduced while sales declined, and is less than cost increased while sales raised, which is called cost "sticky"(Anderson,2003; Sunzheng,2004; Kongyusheng,2007). What causes the production of the enterprise cost stickiness, what are the factors affecting the cost of adhesive, there is no unified conclusion for these academics. For its origin, the main theories interpret it are contract concept, efficiency concept and the concept of agent. The concept of agent is the most widely accepted, but for the influencing factor, each scholar has its own study. The scholars in our country have makes empirical study on the economic environment, industry differences, regional differences, impact angle motivation of earnings management and corporate governance structure such as the structure of the board of directors, actual controllers and managers supervise.The paper is divided into four parties:the first part is the introduction, mainly introduced the background of the research and the significance of this paper, and summarized the study from the domestics and overseas about the management incentive and cost stickiness. The second part is about some concepts of cost stickiness and thee basis theory. The third part is the result of the study. It analysis the cost stickiness under the different actual controller how does the management incentive affects through the selection of China’s manufacturing industry listing Corporation2011-2013data. The empirical result shows that:the cost stickiness is obvious. The forth part is the conclusion of the paper, and then put forward policy recommendations and research prospects on this basis.The innovation of this paper lies in:Although domestic and oversea scholars have research the cost stickiness of existence, economic environment, industry difference, corporate governance structure, there is no in-depth analysis on the factors of the management incentive. Therefore, there are some new ideas for research perspective of this paper.