The Research Of Managerial Discretion And Investment Efficiency

In the era of rapid economic development, listed companies are facing fierce competitionin the market, and how to stand out in such an environment is one of the urgent needs to crackthe problem companies. And high efficient investment behavior can solve the problem, anddevelop the company quickly, increase corporate value. The research of investment efficiencyhas been a subject of classic scholars. As implementers corporate investment decisions, powerof CEO also affects the size of the investment behavior of enterprises, therefore, the size of themanager of autonomy can affect the investment efficiency. But few scholars have studied therelationship between them, the study of the influence on the efficiency of investmentmanagerial discretion in this context.Firstly, the relationship between managerial discretion and investment efficiency are said,and make the comments after the literature summarized. In this paper, the principal-agenttheory, asymmetric information theory to study the basis of autonomy between the managerand investment efficiency are used for the hypothesis of this paper. This article selects2010-2012Shanghai A-share2064listed companies as samples, using Richardson residualmeasurement model for listed companies conducted to determine the efficiency of investment,and ultimately come to model residuals,578companies greater than zero, namelyover-investment happened,1486enterprises model residuals less than zero, namelyunder-investment happened.In this paper, the job right, the expert right, the operation right are used to measuremanagerial discretion. Richardson residual measurement model is interpreted as a variable tothe independence of the board of directors, stake of largest shareholder, stake of CEO are usedfor control variables, establish the model of managerial discretion and over-investment orunder-investment. Final conclusion: managerial discretion and over investment is positivelyrelated, compared with the non state-owned enterprises, CEO in state-owned holds biggermanagerial discretion more prone to over-investment behavior; managerial discretion andunder-investment is positively related, compared with state-owned enterprises, CEO innon-stated enterprises holds smaller managerial discretion, more prone to under-investmentproblem behavior. Through multiple linear regression analysis managerial discretion on investment efficiency, the system has combed the theory of managerial discretion andinvestment efficiency.Based on previous studies, the article used the view of managerial discretion to studyinvestment efficiency. It gives a new way to study investment efficiency for future studies,combined China’s listed companies existing conditions with empirical analysis, it providesrelevant suggestions and counter measures to improve listed companies investment efficiency.