Research On The Impact Of Financial Flexibility On Inefficiency Investment In Manufacturing Listed Companies Under The Perspective Of Product Market Competition

The efficiency of enterprise investment has an important influence on the country's economic growth and enterprise development.There are a large number of manufacturing enterprises in China,which account for a large proportion and have an important position in economic development.At present,the manufacturing listed companies are widespread phenomenon of over-investment and under-investment,this kind of inefficiency investment problem affects both the own value of listed companies,and threaten the stability of the overall economic development in our country.Therefore,it is necessary to study the inefficiency investment problem of manufacturing listed companies.For the research on inefficiency investment,domestic and foreign scholars mostly stand in the perspective of corporate governance,financing constraints and internal control,while few scholars study financial decision-making and external competition environment.Product market competition is the external objective environment faced by enterprises,and the financial flexibility is the measures that can be taken by enterprises.Both of them have a certain role in solving the problem of non-efficiency investment.Based on the degree of competition in product market,this article studies the influence of financial flexibility on inefficiency investment.This study not only provides a new perspective to explore the treatment ways of the inefficiency investment,but also provides policy advice to manufacturing listed companies to deal with over-investment and under-investment,so it has important theoretical and practical value.This paper studies the influence of financial flexibility on over-investment and under-investment in manufacturing listed companies.At the same time,based on the angle of product market competition,the high competition and low competition Industry groups are distinguished.Then,the degree of the influence of financial flexibility on non-efficiency investment is studied under different competitive intensity.Lastly,we study the effect of financial flexibility on inefficiency investment in different group.The research method adopted in this paper is literature research method and empirical research method.First,it summarizes the domestic and foreign research literature on the concepts of inefficiency investment,financial flexibility,product market competition,and on the relationship between them.And analyzes the causes of the inefficiency investment,financial flexibility effect on the inefficiency investment,the influence of product market competition,and expounds the principal-agent theory,the optimal sequence financing theory,competition theory,and so on.Secondly,it analyzes the current situation and problems of inefficiency investment and financial flexibility of manufacturing listed companies,and puts forward specific research hypotheses based on theoretical basis and existing research conclusions.Then,the enterprise's inefficiency investment is measured by the residual value of Richardson model,and the financial flexibility of the enterprise is measured with the sum of cash flexibility and debt flexibility.Then select from 2014 to 2016 years,listed on the Shanghai and Shenzhen manufacturing listed companies as the research sample,using multivariate regression model to observe the impact of financial flexibility to over-investment and under-investment.The product market competition is measured by the Herfindahl coefficient,and as a grouping variable,the regression model is compared to verify that the research hypothesis is correct.Finally,based on the conclusion of the empirical analysis,this paper puts forward some suggestions to solve the problem of overinvestment and underinvestment in manufacturing listed companies,and points out the limitations of this study.According to the empirical research,the following conclusions are drawn: The relationship between financial flexibility and overinvestment in manufacturing listed companies is positive.Excessive financial flexibility can aggravate the overinvestment of enterprises;Financial flexibility can alleviate the under-investment in enterprises,through reserve financial flexibility,the manufacturing listed companies can seize investment opportunities;The fierce competition environment of product market can restrain the positive promoting effect of financial flexibility on over-investment,and also expand the negative effect of financial flexibility on underinvestment.On the basis of the conclusion,this paper puts forward the following policy recommendations:Manufacturing listed companies need to strengthen the consciousness of financial flexibility,and reserve it scientifically,at the same time,to carry out the relevant measures of corporate governance,only in these ways can solve the problem of over-investment and under-investment;The government needs to use the product market competition means and strengthen the supervision to reduce the occurrence of inefficiency investment.