Internal Executive Pay Gap,Product Market Competition And Inefficient Investment

In the process of enterprise development,investment is an indispensable and important part.Efficient investment decisions can provide a strong impetus for the development of enterprises.At present,the situation of investment in our country is serious.Overinvestment and underinvestment are common phenomena in enterprises,which seriously constrained the potential of enterprise developing and wasted a lot of economic resources.In the company,establishing a reasonable internal executive compensation system is a universally applicable incentive mechanism,but research on the effect of executive compensation gap mainly focused on corporate performance and other aspects,and relatively few studies on inefficient investment have been conducted.There is no unified conclusion about its role.At the same time,when studying the relationship between executive pay gaps and inefficient investment,the external mechanism of product market competition may also play an important role,because different industries have different competitive pressures,and different pressures influence the role of the pay gap,so it is significant to put external product market competition into the study.This paper studies the role of the executive pay gap in the enterprise for the inefficient investment,and considers the regulation effect of the product market competition.It will have certain research significance and innovation through considering three factors in the research system.This paper chooses China's A-share listed companies from 2014 to 2016 as research samples,first collates theoretical foundations such as championship theories and principal-agent theory,then makes inferences and puts forward hypotheses,and establishes models to empirically analyze the data to verify whether the assumptions are established.The research results show that:(1)The internal executive pay gap has inhibitory effects on two types of inefficient investment behaviors:overinvestment and underinvestment.(2)The more intense competition in the product market,the less influence gave by internal executive pay gaps,product market competition may partially replace the role of executive pay gaps,and executive pay gaps in fiercer product market competition put weaker influence on inefficient investment.The first chapter of this paper is the introduction.In this part,it explains the research background,the problems and its significance,the methods and framework of the application,and defines the main concepts of this paper.The second chapter is the literature review,which mainly summarizes and combs relevant research results at home and abroad.The third chapter is the theoretical foundation and research hypothesis.In this part,arrange the relevant theoretical basis and put forward the hypothesis of this paper.The fourth chapter is the research design.In this part,explain the sample selection and data sources of this paper,elaborate the variables used in the model,and construct the research model.The fifth chapter is empirical analysis.Use the descriptive statistics,correlation analysis and regression analysis on the study samples to verify whether the hypotheses were established.The sixth chapter is the research conclusion and suggestion.This chapter summarizes the research analysis,discusses the shortcomings,proposes further research directions and expandable areas,and finally puts forward some suggestions based on the results obtained from the research.