A Principal-Agent Perspective on ERP Implementation Decisions - An Empirical Analysis Based on Chinese Listed Companies
Posted: 20 Jul 2007 Last revised: 25 Jun 2010
Date Written: November 6, 2008
This study attempt to find the motivation of ERP implementation based on the principal-agent theory. From the view of information resource sharing and communication, which is a critical characteristic of ERP, this paper investigates whether the decision of ERP implementation is affected by the principal-agent mechanism.
We applied univariate analysis with matched sample and multivariate analysis with logistic regression to our study. Our findings reveal that Chinese companies try to resolve information asymmetry problems from principal-agent mechanism by implementing ERP. ERP adopters have lower shareholding proportion of managers and higher distance between concentration of ownership and managerial ownership than ERP non-adopters.
Our study contributes to the ERP research literatures and information system research. Our study provides a new perspective on the information system research.
Keywords: ERP, principal-agent, ERP implementation
JEL Classification: M40, M41, M46, M47, D82, G34
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