The Time Dependence And Endogenous Of Profitability Of Chinese Listed Companies

Both at home and abroad,the research has focused on the measurement methods and influencing factors of the profitability of the company,and it involves the existence of the general time-varying law of the profitability of the enterprises after the listing.It is a worthy research topic to study whether there is time effect after listing.It can provide us with a new idea when studying the change of profitability of listed companies,and analyze the changing law of profitability from the perspective of enterprises themselves.In this way,itis not only useful for investors to provide appropriate advice on the decision-making,but also useful for managers in the enterprise management in advance to make changes in accordance with the forecast cycle.Therefore,in order to study the time-varying law of profitability of listed companies,this paper chooses the return on assets and economic added value as the measure of profitability.First,the return on assets takes into account all the corporate resources and the ability of enterprises to create profits,including the profitability of the target,compared to the return on net assets indicators,it can not only the company's main business income summarized,but also reflects the enterprise in addition to the main business benefits of other projects,so it is a more comprehensive response to the company's profitability.Second,economic value added is the financing cost to the profit accounting,becoming a more accurate response to the main business,investment income and financing costs of the three business processes.So the profitability of economic value-added responses is more accurate than other indicators.In order to verify the general effect of the time effect of profitability,this paper chooses the quarterly data and annual data of the Chinese and Shanghai A-share market from January 2005 to September 2016.Based on the cross-sectional fixed effect panel model,Time-varying characteristics of post-profitability.The choice of quarterly data and annual data is due to the fact that the frequency of time period may have an effect on the empirical results of corporate profitability.Therefore,it is necessary to select the robustness of different frequency data to test the profitability rule.In addition,it should be noted that the time selected in this paper is based on the company's time to market,in the quarterly data after the IPO company's first full quarter T value of 1,the second full quarter value of 2,and so on.On the basis of this,in order to analyze whether the time effect of profitability has endogenous characteristics,this paper has done the endogeneity test.The empirical results show that the profitability of listed companies is significant and stable with the time of listing The trend of the profitability of listed companies is still significant and robust,even if the influencing factors such as capital structure and corporate liabilities are introduced as control variables,the inflection point is about 4 years.Therefore,the profitability of listed companies exist with the endogenous characteristics of the time effect.Finally,this paper gives the Theoretical conjecture that the profitability of listed companies exist the time effect with the endogenous characteristics from the angle of economics.First of all,the reason may be that enterprises excited mood after listing leads to the decline of the profitability of the listed companies.The success of the listed financing will inevitably aggravate the managers' Investment incentives,making the manager's investment choice is no longer cautious.Many high-risk projects which won't be adopted in the past may be adopted.Excessive investment behavior is very serious,which makes the listed companies ignore the main business and the pursue venture capital projects.This led to a decline in profitability of listed companies.Second,after the listing of the company,the concept of managers and shareholders changed.The managers do not focus on maximizing the value of the company,but the maximizing their own interests.There may be the go-slow or shirk responsibility etc.,resulting in a decline in the profitability of the enterprise.Finally,the elliptical trajectories based on economic variables,if they expand along the time axis,will appear as periodic fluctuating characteristics.