Investigating the Role of Stock Market Development on Political and Ethical Dimensions of Management Behaviors

The purpose of this research is to investigate the role of stock market development on the political and ethical aspects of management behaviors (including: optimistic, short-sighted behaviors, agency cost, profit management and political costs caused by managers' behavior) in companies listed in the Tehran stock exchange. For this purpose, five hypotheses for investigating this issue were compiled and data related to 140 stock exchange member companies for the time period between 2008 and 2021 (consisting of two capital market periods including 2008-2014 and 2015-2021). It was investigated and analyzed. The regression model of the research was examined and tested using panel data method with fixed effects approach and logistic regression method. The results of the research showed that among managers' opportunistic behaviors, optimistic behaviors, representation and profit management under the influence of stock market development in the second period of the capital market decrease more than in the first period and are affected by the increasing effect of stock market development. On the other hand, the results confirm that the short-sighted behavior of managers was not affected by the development of the stock market in the second period of the capital market compared to the first period. In addition, the results indicate that the political cost caused by the managers' behavior under the influence of the stock market development in the second period of the capital market decreases more than the first period, and under the influence, there was an increasing effect of the stock market development.