Nature Of The Property To Study The Effect On Corporate Investment Behavior Of The Degree Of Separation Of Two Rights

Enterprise investment behavior affect the power of its own development andgrowth of the future cash flows, the investment decision of reasonable or not directlyaffect the value of the business,and the corporate governance of company affect theefficiency of investment.The study of many corporate governance found that the natureof the property rights of listed companies, and their degree of separation between thecontrol rights and cash flow rights would be different, a proxy conflict between controlrights and cash flow rights the size separation led to the shareholders will impact oninvestment behavior.However, the non-optimization of the investment scale will affectthe business development strategy, resulting in a serious waste of resources andenterprises at risk.China is in a period of economic transition, the government controlsthe vast majority of resources, and intervents on economic activity and investmentstrategy, which resulted in different investment behavior of Chinese enterprises in thespecial institutional context.First of all, the majority of enterprises under the control of the pyramid structureexist on agency conflicts between large and small shareholders.Secondly, governmentintervention in corporate investment decisions are often out of tax revenue, employmentand other achievements target, unlike special agent conflict of private enterprise.Finally,bank to implement soft budget constraint on loans to state-owned enterprises, and a lotof restrictions on loans to private enterprises, which makes state-owned enterprises havea strong the ability of financing liabilities, while the financing of private enterpriseshampered.In this paper, the nature of property rights for the classification criteria,andthe degree of separation of control rights and cash flow rights to measure agencyconflicts between shareholders, which explore the impact on corporate investmentbehavior of the agency conflicts under the different nature of property rights.We found from the study, the degree of separation of control rights and cash flowrights was significantly associated with investment in the whole sample.Divided intostate-owned enterprises and private enterprises, according to the nature of propertyrights, the two rights separation degree of state-owned enterprises is significantlypositive correlation with the enterprise investment, and the two rights separation degreeof private enterprises was not significant but negative correlation. Then the central andlocal state-owned enterprises into state-owned enterprises, the study found, the degreeof separation of the local state-owned enterprises is significantly positive correlation with the enterprise investment, and the central enterprises are positively correlated butnot significantly.Compared with the central enterprises, the degree of governmentintervention of local state-owned enterprises is greater.The policy recommendations of this paper is to strengthen the governancemechanisms of the government to reform the performance evaluation, appraisal systemto build a new type of science; strengthen the independence of financial institutions, toencourage the development of joint-stock banks, reaching the governance ofstate-owned SBC phenomenon; strengthen the capital marketregulatory specificationslisted company disclosure system to promote the perfection of the oversight bodies.