Corporate Tax Avoidance, Heterogeneity Of Institutional Investors And Inefficient Investment

In the process of improving capital market and rapid economic growth in China,the inefficiency of investment directly influences the speed of economic growth and becomes one of the key concerns of scholars.Based on the existing research results,information asymmetry and agency problems are the main factors that cause enterprises to invest inefficiently,and scholars have conducted extensive research on this.With the development of agency theory,tax avoidance had been added in the factors which influence the investment inefficiency.Recently,the tax agent theory indicates that tax avoidance behavior can intensify the agency problems and information asymmetry,which provides a new idea for our research.In addition,according to the existing literature,the heterogeneity of institutional investors also makes them behave differently in the management of the company.Therefore,there must be some theoretical and practical significance to study the tax influence on the inefficiency of investment based on the path of the agency problem and asymmetric information and the impact of the heterogeneity institutional investors on corporate governance,especially on inefficiency of investment.Based mainly on the principal-agent theory and information asymmetry theory,this paper analyzes the influence mechanism among corporate tax avoidance,the heterogeneity institutional investors and corporate investment inefficiency.Furthermore,we use the A-share listed companies as the research sample from 2008-2015,and use the correlation models to measure the intensity of corporate tax avoidance and investment inefficiency,and distinguish between different institutional investors,then establish the multiple regression model to empirically test the relationship among the three variables.The results show that the tax avoidance of listed companies is positively correlated with the inefficiency of investment of the enterprises.Compared with the institutional investors of low shareholding ratio and trading institutional investors,the institutional investors of high shareholding ratio and stable institutional investors are more able to restrain enterprises' inefficient investment.Compared with the institutional investors of low shareholding ratio and trading institutional investors,the institutional investors of high shareholding ratio and stable institutional investors are more able to weaken the positive correlation between the tax avoidance and the investment inefficiency.Finally,according to the empirical results and correlation analysis,this paper had promoted the relevant policies to mitigate the inefficiency of investment from the aspects of internal governance and external supervision,including perfecting corporate tax avoidance supervision system and improving the governance mechanism of institutional investors.