Managerial Incentive and Development of Family Firms

摘要

In this paper, the author analyzes the influence of managerial shareholdings on his opportunism behaviors, discovering that managerial shareholdings have two different influences on the choice of managerial opportunism degree by model analyses. Based on the studies of other people, the author concludes: on one hand increase of managerial shareholdings proportion will decrease managerial opportunism degree when managerial shareholdings is at a low level; on the other hand increase of managerial shareholdings proportion will also increase managerial opportunism degree when managerial shareholdings is at a relatively high level. Because property rights incentive is not carried out widely in China, the level of managerial shareholdings is usually very low. Therefore, the author suggests, in family firms, appropriate managerial shareholdings to professional managers can effectively constrain their opportunism behaviors, stimulating them to work hard, and promoting the developments of family firms.