Empirical Research On The Constraint Mechanism Of The Inefficiency Investment Of Real Estate Listed Companies

The real estate industry is one of the pillar industries in our country, and the growth ofinvestment of the real estate industry is accounted for about1/10of GDP. So the rationalityof the investment is very important to the healthy development of the national economy.However, the history of real estate market in China is short; the imperfection of the capitalmarket caused by information asymmetry and principal-agent problems in our country’sbirngs about much ineiffciency investment phenomenon in the real estate industry which isnot conducive to the harmonious development of our society.At present, in theoretical circles there has been many studies on ineiffciencyinvestment behavior and its constraints. However, the objects of is the manufactuirngindustry, and the research especially for real estate investment behavior and on therestricting factors of inefficiency investment behavior and combining with thecharacteristics of macroeconomic regulation is less. Therefore, this paper presents athorough study of the inefficiency investment behavior in real estate listed companies andits constraint mechanism.This paper selected the Financial data of114real estate development listed companiesfrom2007to2010as the research sample, the empirical study of this paper has two mainparts:(l) Based on th’e Richardsons model (2006) and improved this model according tothe real estate enterprise’s characteirstic of "investment" and "free cash flow" inmeasurement, and analysed the investment inefficiency situation of real estate listedcompanies;(2) Empirical analysed the impact of debt and equity on the ineiffciencyinvestment of real estate listed companies, and then explained the empirical results.Through the above analysis, the paper draws the following conclusions:(1) over all,There exists inefficiency investment in real estate listed companies in China, and theexcessive investment phenomenon is more seirous.(2) the level of debt can curb theexcessive investment behavior, but it also can cause a certain degree of insufficientinvestment, and the influence of short-term debt is greater. In addition, due to thelong-term debt ratio is high in the real estate enterprise, its role can not be ignored.(3) theshare concentration ratio will be a certain degree of promote the inefficiency investment,and the influence of the nature of the controlling shareholders to inefficiency investment inthe listed real estate is not significant.The main innovation of this paper is: Fi’rstly, from point of the empirical analysed, this paper introduce the Richardsonsmodel, and we not only combined with the characteristics of real estate industry butimproved the model which will be more suitable for the real estate industry and make theresearch results more scientific.What’s more, from point of the research perspective, this article set up a" the nature ofcontrolling shareholders "according to the recent housing market macro-control measures.