Study On The Effect Of Financial Flexibility To Investment Efficiency Based On Life-Cycle

Investment is an important financial decision for the enterprise,the efficiency of investment is not only a matter of the good and bad of the business,but also the rationality of the whole economic and social resource distribution.With the fierce competition in the market,enterprises have shown more urgent need for optimizing investment behavior and improving investment efficiency.At the same time,more and more entrepreneurs are starting to focus on financial flexibility.Financial flexibility is the ability the enterprise uses idle funds and unused debt capacity to deal with the uncertainty of future environment and grasp good investment opportunities,and achieve the enterprise value maximization.Maintain the appropriate financial flexibility in the enterprise,will not only promote its own development,and to improve the efficiency of investment,optimize investment behavior plays a key role.As an organic individual,the enterprise will experience a certain life-cycle stage,In order to achieve the enterprise's goals,it is possible to take effective action according to the life cycle characteristics.Therefore,based on the efficiency of investment theory,according to the different life cycle stages,this paper studies the relationship between financial flexibility and investment efficiency,and provides a reference for enterprises to optimize investment behavior and improve investment efficiency.The research focuses on whether financial flexibility has a governing effect on non-efficient investment in enterprises,and there is a significant cyclical difference in this kind of governance.Therefore,it is especially important how to effectively divide the enterprise lifecycle phase,measure financial flexibility and non-efficient investment.This paper selects a sample of manufacturing companies listed in China.by using Dickinson's approach,the cash flow combination is used to classify all sample enterprises into a period of growth,maturity and decline.To measure the financial flexibility by using the principal component analysis method,the relative financial indexes are taken.On the basis of the Richardson model,the influence factors were selected,the non-efficiency investment evaluation model was constructed,and the non-efficiency investment degree of the enterprise was measured.In order to further illustrate the cyclical characteristics of financial flexibility in the governance of non-efficient investment,the relationship between financial flexibility and non-efficiency investment is analyzed in the life cycle stage.The research shows that:(1)Financial flexibility has the effect of governance on non-efficient investment in enterprises,and the financial flexibility is more significant in the management role of under-investment.(2)In the growth period,financial flexibility and under-investment are significantly negatively correlated,and financial resilience can alleviate the under-investment.(3)there is a positive correlation between financial flexibility and over-investment in mature period,butthe correlation between the two is not strong.(4)during the recession,financial flexibility does not improve the business' s non-efficient investment status.