The Relationship Research Between Free Cash Flow Governance Factors And Enterprises Overinvestment

The over-investment has been a hot topic of China's economy and the focus of debate, the government, especially local government trend to stimulate economic growth through investment. While effective investment is a source of economic growth,the ineffective investment is a waste of resources. as the main body of economic performance,on the micro-level the over-investment of the enterprises have a tight realationship with the macro-level economic overheating.The Corporate inefficient investment behaviors give serious damage to the interests of investors in capital markets. The over-investment of corporate resources belong to the investors is not only a waste of resources, but also the inefficient investment can not get the corresponding output. Thus over-investment behavior of enterprises seriously undermined the interests of investors. Form this purpose of the interests protection of investors,the research on the inhibition of excessive investment behavior make a certain sense.The core of the study is the over-investment and restrainment of enterprises.This article is based on the case of listed companies on stock market from 2007-2010, through theoretical analysis and empirical analysis, trying to find the existence of over-investment. In order to prevent and reduce over-investment behavior, this article provides a theoretical basis and put forward countermeasure and suggestions to verify whether the various investor-protection factors could inhibit the generation of over-investment phenomenon. so this article could make some sense.This paper has five chapters. The first chapter introduced the research background, the significance of innovation. The second chapter, integrated the domestic and overseas scholars'main points of over-investment. The third chapter describes the relative concepts and theories, which supply necessary theoretical foundation to set models. Thenthe fourth chapter is mainly empirical study based on samples of listed companies which in Shanghai and Shenzhen during 2007-2010. The last chapter in accordance with results of the empirical study put forward some advises.