Research On Manufacturing Executive Incentives And Financial Asset Allocation Based On Product Market Competition Perspective

Manufacturing is a direct manifestation of a country's ability to create new wealth,the manufacturing industry of China has always been in a good development trend and is a pillar industry of the country.Factors which affect the development of the manufacturing industry include corporate innovation investment,corporate investment structure,corporate financial asset allocation and so on.The traditional manufacturing's development has restricted severely due to the demographic dividend's disappearance and the labor costs' increace,and the new production methods represented by artificial intelligence are bringing revolutionary industrial changes to the manufacturing industry.Company executives are at the core of the corporate power system,and the decisions they make play an important role in the development of the company,especially in the allocation of financial assets.However,the existence of self-serving behavior of executives makes it possible for executives to use their positions to obtain the maximum benefits of their positions,and then causes serious agency problems.Because executives have different reflections on different executive incentives,then under the influence of product market competition,different executive incentives will cause corporate executives to have different decision-making behaviors on the issue of corporate financial asset allocation.Therefore,enterprises need to establish a complete executive incentive system and have supporting executive incentive measures to restrict executive behavior,so that company executives can consciously make a series of decisions based on the perspective of product market competition in order to stimulate its long-term progress.In this context,this paper has good practical significance to study the internal mechanisms that exist between executive incentives,product market competition,and corporate financial asset allocation.The listed sample companies are used in this paper including both Shenzhen and Shanghai bourse during the period 2010-2018 to talk over the relationship among executive incentives,product market competition and corporate financial asset allocation.Firstly,we use the relevant theoretical basis to determine the research paradigm,and the relevant research hypotheses are proposed.The relevant empirical regression models are constructed according to the research hypotheses to be tested.Then the data is processed and the empirical regression is carried out by using the measurement software stata14.0.Finally,the empirical conclusions are obtained according to the regression results and compared with the previously mentioned hypotheses.The research results show that executive compensation incentives can promote corporate financial asset allocation and executive equity incentives inhibit corporate financial asset allocation,and in non-state-owned enterprises,this relationship is more significant;product market competition can also inhibit corporate financial asset allocation,and product market competition plays a regulatory role in the relationship between executive incentives and corporate financial asset allocation.Product market competition weakens the promotion of executive compensation incentives to corporate financial asset allocation and enhances executive equity incentives to corporate financial asset allocation,and the regulatory effect in non-state-owned enterprises is stronger.Finally,the above conclusions are combined to propose corresponding policy recommendations.