Managerial Overconfidence,Nature Of Property Right And Dynamic Capital Structure Adjustment

Regardless of whether it is in theory or practice,capital structure-related decision-making is crucial in modern enterprise financial decision-making.Especially since MM theory was proposed,the related research on capital structure has received extensive attention from scholars at home and abroad.In the influencing factors of corporate capital structure decision-making,the role of managerial psychological factors is more and more prominent.The dynamic adjustment theory of capital structure believes that enterprises can obtain the target capital structure that maximizes the value of the enterprise on the basis of balancing the tax-saving benefits and the financial distress costs.However,the target capital structure of the company is constantly changing,which has led to the actual capital structure of the enterprise.Deviation from the target capital structure,in order to reduce the cost of capital and maximize the value of the enterprise,the company has the incentive to adjust the capital structure to approach the target capital structure.At the same time,due to the existence of adjustment costs,the company is in the process of adjusting to the target capital structure.Only partial adjustments can be made.The speed of adjustment is the speed at which the company's capital structure approaches the target capital structure,reflecting the magnitude of adjustment costs.In recent years,many scholars have used the dynamic adjustment theory of capital structure to construct dynamic adjustment models to explore the factors affecting the speed of company adjustments.However,most of the previous studies have focused on the influence of variables such as company characteristics and macroeconomic conditions on the company's adjustment speed.Managers' overconfidence,the nature of property rights,and the direction of deviation of the company's capital structure have less concern about the impact of adjustments.Based on this,this paper combines China's institutional background to study the relationship between managerial self-confidence,property right and dynamic adjustment of capital structure in terms of adjustment speed and asymmetry in speed adjustment.This paper draws on the relevant researches of scholars at home and abroad.From 2013 to 2016,A-share listed companies as samples,using fixed-effect models and dynamic adjustment models to empirically test managers' overconfidence.And the impact of property rights on the dynamic adjustment of capital structure,and trying to further explore the interaction of managers' overconfidence and property rights,and finally put forward relevant opinions.The research content of this article generally includes the following parts:The first part is introduction.It elaborates the background and research significance of the article,briefly introduces the framework and main content and summarizes the possible innovations.The second part is literature review and commentary.This includes reviewing and combing relevant research on corporate characteristics,managerial overconfidence,and the dynamic adjustment of the nature of property rights and capital structure,followed by literature review and inspiration on this basis.The third part proposes theoretical analysis and hypothesis.First of all,it defines the related concepts,secondly elaborates the related theories,and finally takes the theoretical analysis as the main one.Combined with the research results of other scholars,the hypothesis of this paper is proposed.The fourth part is the research design.This section introduces the selection and processing of sample data,defines the variables in the selection model,and focuses on the design of empirical models.The fifth part is empirical test and result analysis.This part mainly uses the sample company's data to conduct empirical tests,and uses empirical test results to support the hypothesis.The sixth part is the research conclusions,research suggestions and research limitations.The innovation and main contributions of this paper include the following aspects:First,the paper introduces the two factors of managerial overconfidence and property rights,and studies its relationship with the dynamic adjustment of capital structure.The research on managers,irrationality and dynamic adjustment is an emerging field in China.There are not many existing literatures to discuss it.This paper examines the influence of managerial overconfidence on the dynamic adjustment of capital structure under different property rights.The difference in the influence of self-confidence on the dynamic adjustment has expanded the research extension.Secondly,this paper measures the dynamic adjustment from the two dimensions of adjustment speed and asymmetry.However,the existing literature mostly studies the adjustment speed and the degree of deviation.This paper has developed the path of the influencing factors.