Ownership, Earnings Management And Investment Efficiency

Since the earnings management appears, it has been widely concerned by many domestic and foreign scholars. With the establishment and gradual development of Chinese own capital market, some enterprises use the means of earnings management to meet the listing requirements, keep listed and attract investors. This behavior directly affects the efficiency of enterprises’ investment. In recent years, with the deepening research on the economic consequences of earnings management, scholars start to connect the influence of financial information quality on the efficiency of investment to the influence of earnings management on the efficiency of investment. At the same time, share-holding system economy gradually become an important part of the market economy in our country. According to different ownership, enterprises can be divided into state-owned enterprises and non-state-owned enterprises. In this context, the study of the different ownership on the relationship between earnings management and investment efficiency has important practical significance.Firstly, this paper explores how the path of the earnings management affects the enterprise investment efficiency and analyses the influence of different ownership on this path. Then, it constructs the regression model of the efficiency of investment and earnings management, which considers ownership as an important explanatory variable. This paper chooses date of A-share market from 2008 to 2013 as samples to make empirical research and gets the following conclusions: First, earnings management and non-efficiency investment(overinvestment and underinvestment) has a positive correlation. Meanwhile, the state ownership enforces the positive correlation between earnings management and overinvestment, and weakens the positive correlation between earnings management and underinvestment. Finally, according to the theoretical analysis, empirical analysis and conclusions of the study, and from the view of government and the enterprise, this paper analysis how to reduce the earnings management, promote fair competition among enterprises of different ownership enterprises and reduce the enterprise non-efficient investment level.