| Since the reform and opening up,with the rapid advancement of China’s infrastructure construction,China has expanded its production capacity many times.This has not only boosted China’s GDP growth,but also has hidden dangers for overcapacity in a few years.In 2013,the losses of some capital-intensive industries in China such as steel and cement have exceeded 20%.Solving excess capacity has become an urgent problem for government departments and academia.In 2015,the Central Economic Work Conference of China proposed "three removals,one reduction,and one supplement",marking that the removal of excess capacity has become an important task in China’s supply-side structural reform.The policy document on production capacity has steadfastly promoted the removal of excess capacity.The research released by the Joint Research Group of the Development Research Center of the State Council and the OECD in 2018 shows that China’s overcapacity industries have achieved significant results in reducing capacity.In addition to policy factors,market mechanisms have also played a fundamental regulatory role.Industry capacity is a collection of corporate capacity.Sticky capacity reduction represents the company’s ability to deal with excess capacity under market mechanisms.Executives,as important decision-makers and participants in corporate investment and asset disposal,will directly affect their capacity reduction.situation.However,due to the existence of the principal-agent problem,the interests of shareholders and executives may be inconsistent.As a result,executives may not consider the long-term capacity optimization and upgrade of the enterprise when making decisions on investment and asset disposal of the enterprise,but may take short-term investment.The behavior is not conducive to the removal of excess capacity,which harms the interests of shareholders and exacerbates the excess capacity of the industry at a macro level.Executive monetary compensation and management shareholding are two important forms of executive incentives.They represent short-term monetary incentives and long-term equity incentives for executives,and they play a role in executive investment and asset disposal decisions.Affecting the overcapacity of companies in overcapacity industries.This article studies the impact of executive monetary compensation and management shareholding on the stickiness of the company’s capacity reduction,explores the interaction between the two,and seeks the forms of executive incentives that are most beneficial to the company’s capacity reduction.This paper selects 400 listed companies in China’s overcapacity industries as the research object,and takes 2015-2018 as the research interval.After data screening and processing,1524 sample observations are finally obtained.The research results show that listed companies in China’s overcapacity industry have a negative sticking capacity,which means that when the business volume of a company declines,the company will remove excess capacity in a larger margin,which proves that China’s de-capacity has achieved good results in recent years..At the same time,the de-capacity stickiness of companies with management shareholding is significantly negative,which is better than that of companies without management stockholding,and the executive monetary compensation is significantly positively correlated with the decoupling stickiness of the company,indicating that the salary of executives has increased.Will weaken the company’s capacity reduction.When investigating the interaction between the two,the relationship between executive monetary compensation and de-capacity stickiness of companies with management shares is no longer significant,indicating that management shares have become an effective supplementary tool for executive monetary compensation incentives.It has been proved that "holding share-low salary" is an incentive method that is more conducive to removing excess capacity. |
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