Abstract: The social network relationship formed among enterprises based on chain shareholders is an important factor affecting business management, while academics have mainly focused on the synergistic effects generated by chain shareholders and have paid insufficient attention to their negative effects. This paper examines the effect of chain shareholders on expense stickiness from the perspective of market collusion, using China's A-share listed companies from 2007 to 2022 as the research sample. The research results show that chain shareholders significantly enhance the degree of corporate expense stickiness, which is reflected in the market collusion effect of chain shareholders. In terms of the influence mechanism, the fundamental reason for chain shareholders to enhance corporate expense stickiness lies in market collusion, i.e., the higher the industry concentration, and the higher the competitive market position. In terms of the path of action, chain shareholders mainly influence corporate expense stickiness by appointing directors and reducing equity incentives. In terms of mitigation mechanisms, improving equity checks and balances, internal control quality, exchange information disclosure evaluation and analyst attention can effectively mitigate the increase in stickiness of expenses caused by collusion of chain shareholders. The findings of this paper not only provide empirical evidence for the economic motives of the formation of complex equity relationships among listed companies, but also provide a new reference basis for the revision and improvement of anti-trust related regulations and policies.

Key words: cross-ownership, expense stickiness, market collusion, industry concentration, market competitive