| Research and development(R&D) investment is one of the major strategic activities of the enterprise, it not only affects the competitiveness of enterprises and sustainable development, but also has a profound affection on the corporate governance. With the development of science and technology and the acceleration of economic integration, more and more companies realize the importance of R&D investment in their long-term development. Compared to Western countries, the overall R&D investment of our country is still in lower level, which has seriously hampered the promotion of ability of national scientific and technological innovation and the enhancement of enterprises' sustainable development. Which are the factors of R&D investment, and what is the mechanism? Following the tradition research ideas of the contract theory, agent theory, asymmetric information theory and corporate governance theory, scholars have studied the influence agency problems and information asymmetry done to corporate R&D investment. Because of the difference of the starting point, research methods and research data, the conclusions are controversial. In transition economies, Instead of the agency problem between shareholders and managers, the agency conflicts between shareholders become the focus of corporate governance. It has been found that the control of the controlling shareholder is not single reflected the occupation to minority shareholders. With the increase of the cash flow rights of controlling shareholders, the control rights improve the monitoring done to the managers, the multiplier effect enhanced; while the separation of control rights and cash flow rights is the main motivation of the controlling shareholder obtaining private benefits of control rights. Because of the occupation, the investment and financing decisions controlling shareholders made are always to maximize their own interests, rather than the objective of maximizing corporate value.Therefore, the pursuit of control rights and maximizing their own income of the controlling shareholder becomes the most important factors which affect corporate R&D investment, but the study on this aspect has not been sufficient concerned. On the other hand, the characteristics of high risk, large investment and long payback period determine the financing constraints are important external factors which can restrict corporate R&D investment. On the basis of corporate governance theory, this paper takes the control benefits as the starting point, analyzes the multiplier effect and the entrenchment effect which control rights done to corporate R&D investment, referencing the latest research findings of large shareholders control and control benefits. In depth study, this paper merges agency theory and asymmetric information theory, puts the external financing environment and the internal governance mechanisms into the analysis framework, and explores the characteristics of R&D investment and its efficiency under large shareholders' control, which can be used to explain and demonstrate the mechanism of inefficient R&D investment. The details are below.Chapter 1 is introduction. This chapter first introduces the background and significance of this study, then briefly summarizes the contents of this paper, research ideas and research methods, finally, defines related concepts and summarizes the innovation of this paper.Chapter 2 gives literature review. Taking principal-agent theory, control theory and asymmetric information theory as the theoretical basis, this chapter reviews the literature of corporate R&D investment, and sketches out the framework.Chapter 3 analyzes the mechanism and builds the model of corporate R&D investment based on allocation of control rights. This chapter is divided into two parts. First, studies the path and mechanism controlling shareholders' benefits done to R&D investment, puts the cash flow rights and the separation of control and cash flow rights into LLSV model. The mathematical derivation shows that the cash flow rights and the separation of control and cash flow rights both have the inverted U-shaped relationship with R&D investment. And then puts shareholders and executive incentive into LLSV model, explains their alleviation done to the shortage of corporate R&D investmentChapter 4 gives an empirical analysis of major shareholders control and the corporate R&D investment behavior. The empirical results show that in two-tier stochastic frontier model, compared to the multiplier effect of control rights, the entrenchment effect is the dominant, entrenchment effect makes the actual corporate R&D investment lower 54.92% than the optimal level, the multiplier effect exceeds the actual R&D investment over the optimal level of 27.36%, the net effect is that R&D investment of 27.56% lower than the optimal level, private enterprises' actual R&D investment level is better than state-owned enterprises.Chapter 5 analyzes the relationship between agency and corporate R&D investment. The innovative conclusions are made about the effect of large shareholders' control on corporate R&D investment under Dual principal agent. Moderate equity balance under the control of multiple large shareholders and moderate equity incentive under contingent control allocation between large shareholders and managers can alleviate the occupation the major shareholders done to minority shareholders, and then promote the growth of corporate R&D investment. Cash flow and equity financing can ease the financing constraints of R&D investments, but the cash flow from operating activities and debt financing constraint the corporate R&D investment.Chapter 6 puts forward policy recommendations and conclusions. This chapter summarizes the conclusions of the study, puts forward suggestions about listed companies' R&D investment by using normative analysis, from the points of control allocation, implementation of incentive mechanism and the improvement of capital market, then proposes the limitations and subsequent research ideas of this paper.The innovations of this paper are:(1) The published studies on how corporate governance influences corporate R&D investment, mostly remain on the ownership structure, and have not been involved in control rights. Based on the allocation of control rights, this paper studies the influence how the maximum benefit of control rights done to corporate R&D investment behavior, and test the conduction effect the allocation of control rights of listed companies on R&D investment.(2)This paper constructs the LLSV model, and simulates it by using Matlab. The finds are that: in spite of the relationship between the cash flow rights of controlling shareholders and controlling shareholder value is "U", and the relationship between the separation of cash flow rights and control rights and controlling shareholder value is "U", a modest proportion of cash flow rights and the separation of cash flow rights and control rights are beneficial to carry out R&D investment. The results provide the empirical evidences, which are modest proportion of cash flow rights and the separation of cash flow rights and control rights have positive effects on corporate R&D investment, the high proportion of them are harmful, the model provides a useful perspective for the construction of the corporate governance system and the capital market.(3) The published studies on corporate governance about corporate R&D investment haven't involved the analysis of agent problems between different power holders.This paper uses two-tier stochastic frontier model to construct the non-efficiency model in the framework of dual agency, tests the combined effects agency problems and financial constraints on corporate R&D investment, this method can simulate the real governance environment of R&D investment, and the method can effectively avoid the endogeneity which ordinary regression model has, and avoid findings bias, improve the accuracy of the findings. |
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