A Research On The Relationship Between Financial Contract And Company Investment Efficiency

On October 10,2016,Oliver Hart and Bengt Holmstrom won the Nobel prize in economics for their contribution to the theory of contracts.This not only pushed the development of contract theory to a higher level,but also aroused the attention of scholars from all walks of life to the theory of contract.In modern society,contract is the foundation and reason of society.The idea of contract is everywhere in our life and goes deep into every field.It is to the enterprise as the central nerve to us,connecting and controling the internal and external interests of the enterprise which in the contractual environment.So it can be seen that the governance of the financial contract of an enterprise is actually an enterprise governance from the source of the source.Therefore,in order to solve the conflicts among the parties,we must establish and improve the financial contract system to ensure enterprise's steady operation and development and ensure that the investment behavior is reasonable and efficient.First,it expounds the research status of financial contract and investment efficiency both at home and abroad.At the same time,it collated and studied the previous research results,and determined the purpose and significance of this research.Secondly,based on incomplete contract theory,property right contract theory,free cash flow theory and enterprise investment efficiency theory,we take the three aspects of the financial contract as the starting point,and take qualitative analysis as the main method to achieve a theoretical analysis on the mechanism of the financial contract on investment efficiency.Thirdly,combining quantitative analysis and qualitative analysis,using Excel2010,SPSS17.0,and Eviews8.0 software,based on 671 listed companies of the Shanghai and Shenzhen stock to search analysis,and then taking these data as samples to carry out empirical analysis for verifing the relevance of the effectiveness of the equity contract,the debt contract and the manager's remuneration contract with the efficiency of the company's investment.The results showed that the effective conclusion of the equity contract has a positive help to improve the efficiency of investment.The conclusion of equity contract that weakens the conflict between shareholders is a threat to two types of non-efficiency investment.While the conclusion of the equity contract that weakens the agency conflict is mainly manifested in the suppression of overinvestment.The effective conclusion of the debt contract helps to improve the efficiency of investment.Also does the conclusion of the manager's remuneration contract.The effective conclusion of the monetary compensation contract has the threat to the two types of non-efficiency investment.While the conclusion of the non-monetary compensation contract is mainly manifested in the suppression of overinvestment.Finally,the corresponding suggestions and prospects are put forward according to the results of the test.