Empirical Research On The Impact Of Employee's Compensation On The Stock Price Of Listed Companies

Employees are important force for the company's wealth creation.Employee's compensation is an important economic study issue.Researching the employee's compensation provides a reference for companies to establish a reasonable salary level.First of all,the company pays its employees monetary compensation,including wages,bonuses,subsidies,and allowances.The employee is most concerned about his compensation.Secondly,employees will compare their salary and pay ratio with senior executives,so as to correctly evaluate their salary levels.The increase in salary satisfaction gives employees motivation to work actively.Finally,Reasonable and effective compensation system can motivate employees' enthusiasm.Most of the existing literature are based on the perspective of executive compensation,so this article adopts a new perspective.First of all,from two aspects systematically sort the relevant literature.The first is the effect of employee's compensation on company's performance,and the other is the effect of pay gap on company's performance.Secondly,this article analyzes the mechanism of employee compensation on company's stock price performance from three aspects.The three aspects are organizational incentive theory,efficiency wage theory,and equity theory.Theories are the basis of the following.In the end,the paper uses the data of 1,048 listed companies in Shanghai and Shenzhen A shares from 2014 to 2016,and uses a fixed effect model to analyze the impact of employee's compensation on the company's stock price performance.Later,according to the nature of the company,it was divided into state-owned companies and non-state-owned companies.The results of the study show that the employee stock ownership plan are beneficial to the company's stock price performance,state-owned companies are more vulnerable to relative compensation,and non-state companies are more vulnerable to the salary increase.Based on theoretical analysis and empirical analysis,this paper puts forward corresponding policy recommendations: First,listed companies should establish effective compensation incentive mechanisms and optimize employee compensation systems;Second,listed companies should improve their corporate governance systems.The pay gap between employees and senior managers should controlled within a reasonable range.Third,the employee stock ownership plan is actively and steadily promoted.Fourth,government should optimize relevant regulatory measures.