SavedAdd your journal

Journals / Anemon Muş Alparslan Üniversitesi Sosyal Bilimler Dergisi / 2020 / Cilt: 8 - Sayı: 4

Agency Theory: A Review in Finance

Vekalet Teorisi: Finans Alanında Bir İnceleme

Ali Yavuz POLAT
Hasan TEKİN
Pages
1323–1329
Publication Date
2022-10-11
DOI
—
🏛️Bibliographic metadata and full text access for this article are provided via DergiPark.
DergiPark Record ↗
✨

AI Summary & Key Takeaways

AI Insight
⚡ TL;DR(Too Long; Didn't Read)

This study critically evaluates the principal-agent relations, focusing on the interaction between the shareholder-manager and bondholder-shareholder in corporate finance.

📌 3 Key Takeaways

🎯
Objective & Hypothesis:The problems of agency and risk sharing arise due to the separation of ownership and control of a large firm, when conflicts of interest exist between principals (owners) and agents (managers).
📊
Key Findings & Data:Agency theory, which is still one of the fundamental theories in corporate finance, focuses on minimizing costs in agency relations.
💡
Conclusion & Impact:This study critically evaluates the principal-agent relations, focusing on the interaction between the shareholder-manager and bondholder-shareholder in corporate finance.
🔬Design:Research Article
📍Scope:Comprehensive Sample
⚙️Variables:Domain Parameters

Abstract

The problems of agency and risk sharing arise due to the separation of ownership and control of a large firm, when conflicts of interest exist between principals (owners) and agents (managers). The main source of these problems is asymmetric information, which implies an agency cost for the principal. Agency theory, which is still one of the fundamental theories in corporate finance, focuses on minimizing costs in agency relations. This study critically evaluates the principal-agent relations, focusing on the interaction between the shareholder-manager and bondholder-shareholder in corporate finance.

Özet

Temsil ve risk paylaşımı problemleri büyük firmalarda sahiplik ve kontrolün ayrılmış olmasından dolayı, müvekkil (sahipler) ve vekil (yöneticiler) arasında çıkar çatışması olduğunda ortaya çıkmaktadır. Bu problemler temel olarak bilgi asimetrisinden kaynaklanmaktadır. Bu da müvekkil için vekalet maliyeti ortaya çıkarmaktadır. Halihazırdaki önemli teorilerden biri olan Vekil Teorisi vekalet ilişkilerindeki maliyetleri minimize etmeye odaklanmaktadır. Bu çalışma müvekkil-vekil ilişkilerini daha iyi anlamak için, kurumsal finans alanındaki hissedar-yönetici ve tahvil sahibi-hissedar ilişkilerine odaklanarak, müvekkil-vekil ilişkilerini kritik bir şekilde değerlendirmektedir.

🔖

Cite This Article

POLAT, A. Y., TEKİN, H. (2022). Agency Theory: A Review in Finance. Anemon Muş Alparslan Üniversitesi Sosyal Bilimler Dergisi, Cilt: 8 - Sayı: 4, 1323–1329. https://ajindex.com/articles/440340

📄 Full Text PDF Viewer

📄

PDF görüntüleyici hazırlanıyor...

References (14)

  1. Akerlof, G. A. (1970). The Market for "Lemons": Quality Uncertainty and the Market Mechanism. Quarterly Journal of Economics, 84(3), 488-500.
  2. Arrow, K. J. (1971).
  3. Insurance, Risk and Resource Allocation. Essays in the Theory of Risk Bearing, 134- 143. Bebchuk, L., Cohen, A., & Spamann, H. (2010). The Wages of Failure: Executive Compensation at Bear Stearns and Lehman 2000-2008. Yale Journal on Regulation, 27, 257-282.
  4. Berle, A. A., & Means, G. C. (1932). The Modern Corporation and Private Property. New York: MacMillan. Berzins, J., Bøhren, Ø., & Stacescu, B. (2018). Shareholder Conflicts and Dividends. Review of Finance, 22(5), 1807-1840.
  5. Bhagat, S., & Bolton, B. J. (2013). Bank Executive Compensation and Capital Requirements Reform. SSRN Working Paper Series, No: 1781318. Bolton, P., Mehran, H., & Shapiro, J. (2015). Executive Compensation and Risk Taking. Review of Finance, rfu049. Booth, L., Aivazian, V., Demirguc-Kunt, A., & Maksimovic, V. (2001). Capital Structures in Developing Countries. The Journal of Finance, 56(1), 87-130.
  6. Brockman, P., Martin, X., & Unlu, E. (2010). Executive Compensation and the Maturity Structure of Corporate Debt. The Journal of Finance, 65(3), 1123-1161.
  7. Buck, T., Bruce, A., Main, B. G., & Udueni, H. (2003).
  8. Long Term Incentive Plans, Executive Pay and UK Company Performance. Journal of Management Studies, 40(7), 1709-1727.
  9. Chen, J., Hill, P., & Ozkan, N. (2014).
  10. Financial Distress Risk, Executive Compensation and the Executive Labour Market. SSRN Working Paper Series, No: 2580561. Copeland, T. E., Weston, J. F., & Shastri, K. (2005). Financial Theory and Capital Policy. 4 th edn. USA: Pearson Education. Cuevas Rodríguez, G., Gomez Mejia, L. R., & Wiseman, R. M. (2012). Has Agency Theory Run Its Course? Making the Theory more Flexible to Inform the Management of Reward Systems. Corporate Governance: An International Review, 20(6), 526-546.
  11. Damodaran, A. (2011). Applied Corporate Finance. 3 rd edn. USA: John Wiley & Sons. DeYoung, R., Peng, E. Y., & Yan, M. (2013). Executive compensation and business policy choices at US commercial banks. Journal of Financial and Quantitative Analysis, 48(01), 165-196.
  12. Eisenhardt, K. M. (1989). Agency Theory: An Assessment and Review. Academy of Management Review, 14(1), 57-74.
  13. Fahlenbrach, R., & Stulz, R. M. (2011). Bank CEO Incentives and the Credit Crisis. Journal of Financial Economics, 99(1), 11-26.
  14. Fama, E. F., & Jensen, M. C. (1983). Agency Problems and Residual Claims. Journal of Law