Research On The Influence Of Executive Overconfidence On Cost Stickiness From The Perspective Of Salary Incentives

As an important part of enterprise management,cost management is minimally affected by outside world and is an easy-to-improve management area.In view of the disappearance of the demographic dividend,how to effectively control costs,rationally allocate resources,and achieve efficient transformation of industrial upgrading has become an urgent need for research and exploration.Management's decision-making plays a pivotal role in the development of the company.The cost structure and resource allocation depend on management's decision-making.In the traditional theory of cost behavior,the cost is divided into fixed cost and variable cost.It is considered that the change amount of business volume is a function of the cost change,and the relationship between the two has symmetry.However,with the deepening of research,more and more researchers have found that the changes in cost and business volume are asymmetrical.Foreigner first analyzed the asymmetry of the relationship between cost and business volume through empirical research.The results show cost viscosity.China's modern enterprise system started late,and the influence of management on the allocation of resources largely depends on subjective judgment,which affects the size of corporate cost stickiness.More modern research scholars believe that the occurrence of cost stickiness is influenced by multiple factors such as management's confidence level,management's investment behavior,corporate capital structure and macroeconomic conditions.After the separation of the two powers,the management may achieve maximum profitability rather than maximize the value of the enterprise through certain resource allocation methods.Therefore,how to reduce the cost stickiness of enterprises has become an urgent problem to be solved.At present,literature studies have shown that executive compensation incentives will inhibit cost stickiness,and managers' overconfidence will deepen the degree of cost stickiness,and the degree of influence of the interaction between the two on cost stickiness is still rarely studied.This paper breaks through the boundaries of traditional corporate governance,and deeply explores the mechanism and operational mechanism of executive compensation incentives and managerial overconfidence behavior on cost stickiness.This paper first reviews the relevant theoretical basis and research literature review of cost stickiness,and then proposes research hypotheses based on theoretical analysis.Based on the empirical data of 1570 listed companies in Shanghai and Shenzhen A-share manufacturing in 2005-2017,an empirical test model is constructed.From the perspective of executive compensation incentives,it analyzes and examines the impact of managerial overconfidence on cost stickiness.The results show that executive compensation incentives can restrain cost stickiness,and compared with state-owned enterprises,executive compensation incentives of non-state-owned enterprises have more prominent effects on cost stickiness;managers' overconfidence will increase the costeffectiveness of enterprises.Compared with state-owned enterprises,the overconfidence behavior of managers of non-state-owned enterprises is more prominent in the enhancement of cost stickiness.Further explore the impact of the combination of executive compensation incentives and overconfidence on cost stickiness: Executive compensation incentives will inhibit managers' overconfidence and enhance the cost viscous(the higher the internal control level,the more obvious the inhibition effect),And the non-state-owned enterprise executive compensation incentives are more effective than the state-owned enterprises in suppressing the overconfidence of managers.The research aims to provide a useful reference for deepening cost management strategies,optimizing cost structure,and improving management governance efficiency.