A Comparison of Agency Cost for Different Corporate Governance Models: Taiwan vs. Hong Kong

• Main Authors: Teek-Fong Loi, 雷狄鋒
• Other Authors: Yi-Ran Jia
• Format: Others
• Language: zh-TW
• Published: 2011
• Online Access: http://ndltd.ncl.edu.tw/handle/69085096636616102343

碩士 === 義守大學 === 財務金融學系碩士班 === 99 === This study examines the differences in agency costs with two corporate governance models which are Japan-Germany Model and UK-US Model. The purpose of this study is to find out which of the model will give a better performance with low agency costs by using Taiwan (Japan-Germany Model) and Hong Kong (UK-US Model) as the example. The empirical model used in this study was referred to Battese and Coelli (1992) Stochastic Frontier Model. The period of this study from year 2002 to 2007. Our results show that agency costs do exist in both Taiwan and Hong Kong listed companies. When time is taken to be influence factor, results shows the agency cost of the company will changes over time and has a negative correlation. Besides, taking company’s agency cost heterogeneity in the mean as an influence factor, the main influence for Taiwan was product market pressure while Hong Kong was CEO’s and shareholders’ stockholding. In conclusion, without taking agency cost heterogeneity as a factor, Taiwan shows a better performance (Taiwan 88%, Hong Kong 65%), while agency cost heterogeneity taken as a factor, Hong Kong shows a better performance (Taiwan 52%, Hong Kong 91%). From this point, Taiwan shows a big difference in nature of company and caused a greater difference between the optimal value and the companies’ value. Whereas, Hong Kong has a smaller difference in nature of company, therefore has a smaller value difference. At last, we’re using Time Decay Model as the comparison model, without taking company’s nature as an influence, the final result shows Taiwan(Japan-Germany Model) has a better in performance.