UM E-Theses Collection (澳門大學電子學位論文庫)
Title
Does political connection affect sensitivity of executive pay to firm performance? :evidence from China
English Abstract
In this paper, I mainly explore how political connection affects sensitivity of executive cash compensation to firm performance in Chinese listed firms. I find that executive cash compensation level is more determined by accounting earnings rather than stock return due to less developed stock market in China. This paper provides some evidence that the executive pay of private firms with political connection is higher and more sensitive to earnings than those without political connection, because executives holding political right or relationship have more bargaining power to establish management compensation and ask for higher cash compensation from operation profit. Further, I test effect of pay-for performance sensitivity from government control in the same sample years. It also shows positive impact of government control on sensitivity of executive cash compensation to firm performance, even though the compensation level is significant lower than non-state owned enterprises. These findings support my expectation that political intervention may positively affect incentive compensation schemes.
Issue Date
2014
Author
Yang, Ying Ying
Faculty
Faculty of Business Administration
Department:
Department of Accounting and Information Management
Degree
M.B.A.
Subject
Corporate governance -- China
Organizational effectiveness -- China
Political planning
Accounting -- Department of Accounting and Information Management

Supervisor
Lee Byung Hee
Files In This Item:
Full-text (Internet)
Location
1/F Zone C
Supervisor
--