Empirical Analysis Of Interest Rates Impact On The Listed Companies’ Inefficient Investment

Investment as one of the "troika" of stimulating rapid economic development in the30years since China’s reform and opening up, is the main driving force of China’s economic growth. The macro investment is composed of micro-enterprises investment, therefore a good investment of enterprises play a significant role for economic development. Investment efficiency is an important factor to enhance corporate value. However, due to commission agents, asymmetric information, corporate governance structure factors, business managers are often difficult to make the right investment decisions, lead to inefficient allocation of resources, result in inefficient investment, which is underinvestment or overinvestment. Therefore study the factors that affect inefficient investment behavior, it has a strong theoretical and practical significance for enterprise to improve the allocation of resources, increase enterprise value and reduce business risk.The study of factors affecting the investment efficiency of enterprises at home and abroad mainly focus on commission agents, asymmetric information, corporate governance structure, and behavioral finance, this paper is on the basis of the former research, choose3861samples listed company’s experience and financial data from Shanghai and Shenzhen A-share in2007-2011, according to the following order to study the inefficient investment behavior. We first examine the sample whether a listed company universal existence the inefficiency investment behavior, according to the residuals less than zero or greater than zero, the listed companies will be divided into in the underinvestment group or overinvestment group. On the basis of the above analysis, we inspect how corporate debt interest rates influence inefficient investment, we specific research whether the debt rates constraint enterprises’ investment and further result underinvestment, also whether it can suppress overinvestment. Finally we introduce the variable called government policy interest rate, examine the relationship between government policy interest rates and corporate debt interest rate, explore how government policy interest rate affect the corporate inefficient investment.Through empirical research we get the following conclusions:First, under the influence of the principal-agent problem, asymmetric information, imperfect corporate governance structure, the sample of listed companies universal exist inefficient investment phenomenon, that is underinvestment or overinvestment, and the underinvestment is more serious than overinvestment; Second, the role that the debt interest rates can exacerbate underinvestment is not significant, but the debt interest rates can prevent overinvestment phenomenon; Third, corporate debt interest rates change with government policy interest rates, they have a significant positive correlation; Finally, we get that through debt interest rates, the government interest rate affect inefficient investment, in line with Keynes’s investment-interest theoryAt last, according to the theoretical analysis and empirical results of the study, combined with the national conditions of our interest rate is not market-oriented, to improve the efficiency of business investment, enhance corporate value. We give the relevant policy recommendations as follows:First, promote interest rate liberalization process, improve financial market; Second, vigorously develop the corporate bond market, to broaden the financing channels for enterprises; Third, To attach importance to the role of liabilities camera governance, implement manager policy with constraints and incentives combined;Fourth, enterprises should establish a sound corporate governance mechanism, good and effective corporate governance structure can mitigate the principal-agent problem and the asymmetric information problem, perfect ownership structure, will be helpful to protect minority shareholders’interest.