Český finanční a účetní časopis 2011(4):52-67 | DOI: 10.18267/j.cfuc.148

The Agency Cost from the Point of View of Financial Markets

Tomáš Buus
Ing. Tomáš Buus, Ph.D. - odborný asistent; Katedra financí a oceňování podniku, Fakulta financí a účetnictví, Vysoká škola ekonomická v Praze, nám. W. Churchilla 4, 130 67 Praha 3, <buust@vse.cz>.

We examine agency cost in the multibusiness enterprises (hereinafter "MBE"). Our goal is to find out, whether is there a positive relationship between the complexity of MBE and agency cost. Results are ambiguous, nevertheless we got an indirect indication that more complex MBE bring more advantages than disadvantages and that the avoidable agency costs are effectively eliminated at the lower levels of MBE structure. It emerges then that the main reason for agency cost is information asymmetry and the largest part of avoidable agency cost emerges in the highest levels of corporate hierarchy.

Keywords: Multibusiness Enterprise; Agency Cost; Risk.
JEL classification: G34, M16, M50

Published: December 1, 2011  Show citation

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Buus, T. (2011). The Agency Cost from the Point of View of Financial Markets. Czech Financial and Accounting Journal, 2011(4), 52-67. doi: 10.18267/j.cfuc.148
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