An Empirical Study Of The Impact On Agency Cost In Listed Company Imposed By Capital Structure

As the essence of China's enterprises, listed companies powerfully promoted the development of China's capital market and the socialist market economy. But due to kinds of unfavorable factors'influence, there are also a number of serious problems existed in listed companies, which restricts their development seriously. This is mainly because the capital structure of the listed companies is not perfect and leads to two kinds of agency cost which reduce the enterprise value. One exists in the agency relationship between shareholders and managers; the other exists in the agency relationship between controlling shareholders and small shareholders. A large number of theoretical and empirical researches confirm that the capital structure and agency costs are closely linked, so the research has significant value. This study selects some factors that influence agency cost significantly from capital structure and analyzes their impact on the two types of agency costs separately, so as to identify the most important factors and improve the governance structure of listed companies. Most of the current study take the listed company as a whole and seldom make the comparative study between state-owned and private listed companies. But there exists obvious differences between these two kinds of companies, such as shareholding structure, corporate governance mechanisms and so on, so this study makes a comparative study.This paper selects 79 state-owned listed companies and 49 private ones those occur control transfers and makes correlation analysis and multiple regression analysis. The main conclusions are as follows:the most serious agency-cost problem in state-owned listed companies is the first one, but the hypothesis that the most serious agency-cost problem in private listed companies is the second one has not been proved; as to the relationship between the ownership concentration ratio and the first class agency cost, in the whole sample and state-owned listed companies show a positive correlation, but negative correlation is found in private listed companies; as to the relationship between the ownership concentration ratio and the second class agency cost, all samples show negative correlation, but the impact of private listed companies is greater than that of state-owned listed companies, so state-owned listed companies should lower the concentration and maintain it at an appropriate interval, private equity companies should make an appropriate increase in the degree of concentration; check-and-balance of stock ownership has a positive effect on the first class agency cost and the impact of private listed companies is greater than that of state-owned listed companies, but the check-and-balance of stock ownership has a negative effect on the second class agency cost and the impact of private listed companies is greater, therefore check-and-balance of stock ownership should be kept in a reasonable range and private listed companies should take full advantage of the constraint function of check-and-balance of stock ownership; executives holdings has a negative effect on the first class agency cost, but don't have significant effect on the first class agency cost, so the function of executives holdings has not been confirmed; debt financing and two types of agency costs are all positively correlated but the positive correlation between debt financing and second class agency cost in state-owned listed companies didn't pass the significant test, besides we can see the impact of private listed companies is greater if only judging from the regression coefficients, so private listed companies should pay more attention to issues arising from debt financing.Finally, on the base of problems discovered in empirical analysis, this paper puts forward some relevant recommendations, which may help to improve the capital structure and reduce the two types of agency costs.