The Influence of Intra-temporal Duality on Agency Cost and Agency Efficiency: Future Government Bureaucrats and Existing CEOs

Abstract

China’s economic is changing from planned economy to market economy and partial privatization of state-owned enterprises (SOEs) is also a common problem which many emerging countries will face in the transition period. We find that both agency cost and agency efficiency of SOEs are higher than non-SOEs. We also find the main reason of higher agency efficiency of China’s SOEs is that CEOs want to be government bureaucrats so they work hard-political consideration.