The Research On The Relationship Between Executive Equity Incentive And Dynamic Adjustment Of Capital Structure

Capital structure in the modern enterprise finance is in a vital position,the capital structure of the study has been the theoretical and practical community of many concerns.And there is a very close relationship between executive equity incentive and corporate capital structure.The separation of the two powers under the characteristics of the modern enterprise and the asymmetry of the information on the market will lead to the question of the principal-agent,and the equity incentive is regarded as an effective means to alleviate the agency problem between the shareholder and the manager.Enterprises to implement equity incentives,so that business management can participate in a certain percentage of the remaining income distribution,its own interests and the company's performance with each other binding,so that executives can promote their own interests and more concerned about the adjustment of corporate capital structure,and then to maximize the value of enterprises.Whether it is executive incentive or corporate capital structure,they are the focus of the study,but the relationship between the two is still in the exploratory stage,and the original analysis and research are the main A-share market as a research object,and for small and medium enterprises have not yet.Therefore,this paper focuses on the effectiveness of executive equity incentive measures in the dynamic adjustment of capital structure in China's small and medium-sized board market,with a view to obtaining some empirical data for small and medium-sized enterprises in China.This paper first reviews the theory of executive incentive and capital structure,and then combs the literature from two aspects:the dynamic adjustment of capital structure and the relationship between executive equity incentive and capital structure.Secondly,the paper analyzes the development process and characteristics of the listed companies in China's small and medium-sized board companies,and then analyzes the implementation of the equity incentive of the plate and the analysis of the current situation of the capital structure of China's small and medium-sized listed companies from three different perspectives:industry characteristics,regional differences and enterprise nature through the use of data for 2010-2015.Then,by adding interactive items to constructing a partial adjustment model that includes executive equity incentive factors,using OLS regression method and fixed effect regression method to analyze the data of listed companies in China's small and medium-sized enterprises from 2010 to 2015 to examine the impact of executive equity incentive on the pace of capital structure adjustment.Finally,the conclusion of this paper is summarized,and some suggestions are put forward.The empirical results show that:firstly,the executive equity incentive has a positive effect on the adjustment of the capital structure of the enterprise.The greater the incentive intensity of the executive stock,the faster the capital structure adjustment.Secondly,the executive equity incentive at different levels of debt,the performance is different.The effect of increasing the intensity of equity incentive to improve the speed of capital structure adjustment is significant when the capital structure needs to adjust down,and it is not obvious when the enterprise capital structure needs to adjust upward.Thirdly,the effect of executive equity incentive is different in the nature of property rights of different enterprises.The effect of increasing the incentive intensity of the shares to improve the speed of capital structure adjustment is significant in non-state enterprises,but not in state-owned enterprises.Finally,based on the research conclusion,the following suggestions are put forward:(1)continue to expand the scope of implementation of equity incentive of listed companies in China's small and medium-sized board;(2)increase the debt financing of non-state enterprises in small and medium-sized enterprises;(3)deepening state-owned holding reform;(4)small and medium enterprises according to their own actual situation to determine the reasonable proportion of executive equity incentive;(5)to strengthen internal control,and continuously improve the level of corporate governance.