| Investment activity is one of the company’s most important financial decision-making activities. The company’s investment activities are reasonable or not, will have a huge impact on enterprise value. However, relevant data show that Chinese investment has been in a continuous state of overheating investment, which not only results in the waste of social resources, but also limits the improvement of business efficiency. The traditional financial theory based on the rational assumptions can’t reasonably explain many financial phenomenons.Behavioral finance theory considers the psychological characteristics of management, which exactly makes up that deficiency and provides a broader development direction for investment decision theory.This paper bases on the theory of behavioral finance, and from the perspective of managers’irrational, study how the managers’overconfidence affects investment behavior with the statistics of Shanghai and Shenzhen A-share listed companies in2008-2012. And also investigate the constraint effect of creditors and independent director to managers’irrational investment behavior from the perspective of corporate debt and corporate governance. The study found that managers’overconfidence is more prone to overinvestment; low education and short tenure managers are more prone to overconfidence psychological bias; creditors and independent director can effectively restrain managers’irrational behavior.Based on above analysis, we propose to develop a scientific and rational corporate financial decision-making process, deepen their understanding of managerial overconfidence awareness, and strengthen supervision overinvestment behavior of managers. This conclusion is helpful to reveal the potential relation between manager’s psychological deviation and the efficiency of investment, and can enrich the theory of behavioral finance research about managers’overconfidence psychological characteristics. |
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