Can “Local Accent” Reduce Agency Cost ?——Study Based on the Perspective of Dialects
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| Title | Can “Local Accent” Reduce Agency Cost ?——Study Based on the Perspective of Dialects
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| Author | Dai Yiyi,Xiao Jinli and Panyue |
| Organization | Xiamen University |
| Email | yydai@xmu.edu.cn；mailjinli@126.com；panyue@xmu.edu.cn |
| Key Words | Culture; Dialect; Corporate governance; Agency cost; Social identity |
| Abstract | This paper successfully identifies the dialects spoken by the chairman of the board and CEO respectively by combining the data of executives' birthplaces and “Atlas of Chinese Language”, and systematically analyzes the effect mechanism of the consistent of the dialect spoken by chairman of the board and CEO to the interactive relationship between them basing on the Sapir–Whorf hypothesis and Social Identity theory, and then empirically test the influence of such consistency to the agency cost using the data from China’s A Share listed company from 2009 to 2014. The results show that the if chairman and CEO come from the same dialect area the firm will have lower agency cost, which becomes more significant when the types of dialect are classified finer. After controlling the influence of non-culture factor, the dialects still plays a role. Further study finds that dialect identification can reduce agency cost only in private enterprise and work more powerful in the area with population inflow. This paper thoroughly analyzes the influence of Chinese culture on corporate governance based on the pure data from single country, which supplements the microscopic research in “culture and finance” and provides new evidences for market participants to insight into the influences of Chinese traditional culture on economic development. |
| Serial Number | WP1093 |
| Time | 2016-08-10 |
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