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The Influence Of Executive Compensation On Expense Stickiness

Posted on:2017-02-01Degree:MasterType:Thesis
Country:ChinaCandidate:Y ChenFull Text:PDF
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A business expenses related to the quality of its management in the industry’s competitiveness,so the managers as the decision maker of the business strategy,should be beneficial from the perspective of long-term development point of view,timely adjustment expenses,rational allocation of corporate resources to create greater value for the company.Traditional theory of expense behavior think the change in the fluctuation range of the expense and volume of business is the same,that is,expense only about changes in traffic,but in fact this theory is an idealized,it only considers the impact of traffic on the expense changes,completely ignores the impact of other factors,such as management’s subjective decision-making,the uncertainty of future demand.To this,scholars have put forward the "expense stickiness" this concept,namely the increase of expense in higher volumes range narrowed by greater than in the fall,the expense depends not only on the change of the size of the volume changes,also depends on the change of direction.The emergence of the concept of expense stickiness is a challenge to traditional expense management accounting,it greatly enriches the theory of expense management in the field of accounting research,creates a new system of theoretical research.Now,the problem of the existence of expense stickiness have already reached positive research results at home and abroad,but on the influence factor of the expense stickiness have different research results,there is still controversy.In this paper,basing on the existing research,we try starting from the executive compensation as self-interest of a manager,analyzing the influence of executive pay level,structure,gap on expense stickiness.In theory,it enriches the previous related research in the field of expense stickiness,fills the blank in the research of executive pay gap’ s influence on expense stickiness,provides some ideas for the listed companies in China to effectively manage expense through reasonable design of executive compensation system,it will help the enterprises to management expense by designing a more reasonable executive compensation system,in order to control the executive’s self-interest,reduce agency expenses,maximize shareholder interests.This article through the arrangement of domestic and foreign literature,studying the effect of executive compensation for expense stickiness on the basis of related theory by using the combined method of standard research and empirical research,choosing three aspects of executive pay-the level,structure,gap,respectively to study their effects on enterprise expense stickiness.Specification of the articles with the research methods,this paper starting from combing related literature at home and abroad,analyze the influence of executive pay on expense stickiness basing related theory and put forward the reasonable assumptions,finally propose suggestions of expense management on the basis of the empirical results.In empirical research part,This article bases on the Shanghai and shenzhen A-share manufacturing listed companies from 2008 to 2015 years of financial data as sample,using descriptive statistics analysis and multiple regression analysis of STATAresults come to the research conclusion.This paper is divided into five parts to research the influence of executive pay on expense stickiness:The first part is introduction.On the basis of reviewing the current research,it introduced the background,and proposed the significance of this paper,and then described the research content and research methods,and finally describes the innovation of the paper.The second part is literature review.In this part,it reviewed and summarized the related literature from the existence and causes of expenses viscous,the factor of expenses viscous,executive compensation,executive compensation structure,the executive pay gap five aspects.On this basis,the research status of existing literature are analyzed.The third part is the theory analysis.This part mainly introduced the basic theory of this paper is based.It briefly introduced the principal-agent theory,the economic man hypothesis,the principle of self-interest behavior and tournament theory,analyzed theoretically the influence of the viscosity on the executive pay,and put forward the hypothesis of this paper.The fourth part is the empirical analysis.Based on the above assumptions,with the mainstream model,the selected sample for statistical analysis and correlation analysis descriptive,and come to the preliminary conclusion of the study;the final robustness test,provide more adequate empirical evidence for the conclusions.The fifth part is the conclusion.According to the empirical analysis,it summarized the main conclusions of this study,put forward suggestions,and explained the limitations.Based on the 2008-2015 Shanghai and shenzhen A-share manufacturing listed company financial data as sample,using descriptive statistics analysis and multiple regression analysis of STATA results,we found that:(1)Manufacturing listed companies in our country have expense stickiness.(2)Executive pay levels will affect expense stickiness of listed companies,the higher the level of executive pay,the less expense stickiness degree of listed company.(3)Executive compensation structure will affect expense stickiness of listed companies,higher proportion of short-term monetary compensation executives will lower the expense stickiness degree of listed company.(4)Executive pay gap will affect the expense stickiness of listed companies,the higher executive pay gap,the less expense stickiness degree of listed company.
Keywords/Search Tags:Expense stickiness, the Level of Executive Pay, the Structure of Executive Pay, the Gap of Executive Pay
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