Study On The Role Of Heterogeneous Institutional Investors In Constraining Corporate Over-investment

Investment is crucial for driving economic growth.the phenomenon of over-investment in enterprises is a waste of resources and damages shareholders'wealth.It is becoming a hot research of how to effectively constrain over-investment.Institutional investors in China presents a fast development trend under the impetus of the development of capital market and policy in recent years.Among various constraining mechanisms,institutional investors gradually attract the scholars'attention.But most of the existing research regarded different institutional investors as a whole or selected securities investment fund as a representation,which were biased.Based on the principal-agent theory,asymmetric information theory,corporate governance theory and cost-benefit theory,the paper analyzes the role of China's institutional investors in constraining over-investment.Eventually,using the data of 2009-2013 from A shares of China's listing corporation,the paper measures whether institutional investors can effectively constrain over-investment.The result shows that,institutional investors can constrain over-investment as a whole;the independent institutional investors can effectively constrain over-investment,but the sensitive institutional investors cannot;the QFII and the securities investment fund can effectively constrain over-investment and the former play a more effective role.Overall,we should further develop securities investment fund and loosen the limit of QFII's shareholding.At the same time,it is important to strengthen the investors' independence;and to control the adverse effect from business relation and government intervention to improve investors' enthusiasm.