Research On The Relationship Between Foreign Investment And Public Welfare Expenditure Ability Of Charitable Organizations In China

In recent years,natural disasters happened constantly,Wenchuan Earthquake and Lushan Earthquake.As a carrier of the Chinese philanthropy's development,Charitable Organization plays a big on social assistance,which could solve the problems government failure caused.Since the fund of China Charity Federation in 1994,Philanthropy in China mainland has entered a new development period.However,it aroused many issues as well.At 2001,CYDF invested the money of donations at stock and real state,which caused hug losses.At 2011,the events of Henan Soong Ching Ling Foundation illegal investment aroused a wide concern.Based on the study of the Charitable Organization on investment activities,analyzing the connections among the charitable organization's public property right,Sustainable Development Theory and Principal-agent,the paper explanted the connection between charitable organizations and Public welfare expenditure.During period of the charitable investment,according to the Public Property Right Theory,ROI was not allowed to being divided and can only being retained within the organizations.Beside,Sustainable Development Theory provided theory supporting for the necessary of the charitable organization investment.The paper assume that the charitable organization's investment activity will improve the efficiency of Public welfare expenditure.The paper measured he efficiency of public welfare by analyzing the ration of pubic welfare expenditure in the total expenditure and the growth rate of public expenditure,assessed the efficiency of investment activities by analyzing the ration of ROI in the total ROI and investment asset in the total assets.By studying the foundation,the paper collected the financial date from 2012 to 2015,and tested the impact of investment on public welfare expenditures with Panel Data Model.The results show that the ration of ROI in the general income has a strong negative correlation with the ratio of the public welfare expenditure in the total expenditure,which means The invest activities will not reinforce the efficiency of public welfare expenditure.Research hypothesis has not been proved yet.The paper analyzed the causes from theory and practice.Theoretically,according to the moral risks and adverse selection among the relationship between investment and principal-agent,the impact of investment on public welfare need to be tested by reality.To the practical point of view,the result may could cause by the selected variables and samples.Second,the unsound law,the unfavorable investment environment and defective internal management mechanism also have an impact on its' result.In the end,by analyzing the data and reason,on the basis of the current situation of charitable organization investment,the paper proposes countermeasure suggestions from the perspective of government and charitable organizations to provide reference for the management of organizations.