Stock Liquidity,Agency Cost And Enterprise Innovation

This paper studied the relationship between stock liquidity and enterprise innovation.Through researching the domestic and foreign literatures and combined with principal-agent theory,liquidity premium theory,stock price information mechanism theory and stakeholder theory,the paper holds the belief that stock liquidity can promote enterprise innovation by alleviate the enterprise' financing constraints,improving the shareholders' supervision profits and enthusiasm,making the management compensation contract more effective and so on.Further study explores the possible impact mechanism of stock liquidity on enterprise innovation and founds that agency cost plays an important role in the mechanism of stock liquidity affecting enterprise innovationThe empirical part utilized 2045 A-share listed companies in 2009-2017 as the research sample,and first tests the impact of stock liquidity on corporate innovation.Since paper measuring enterprise innovation from two aspects: investment to R&D and the number of patent applications,it needs two-way fixed effect model and the negative binomial regression model respectively to conduct empirical tests.The regression results of the two-way fixed-effects model show that the stock liquidity can significantly improves the degree of R&D investment,and the results of the negative binomial regression show that stock liquidity can significantly improves the firm's innovative output as well,which indicates that the improvement of stock liquidity can significantly promote corporate innovation activities.After that,the paper studied whether stock liquidity affects the agency cost.By divided agency cost into the first type of agency cost and the second type of agency cost,this paper founded that the improvement of liquidity can significantly reduce the two types of agency costs in the enterprise,and the mitigation effect of the first type of agency cost is more significant than the second type of agency cost.Finally,In order to study the influence path of stock liquidity on enterprise innovation,this paper uses Zhonglin Wen's(2004)mediation effect test to test the two types of agency costs as the intermediary variables.The research results show that the first and second types of agency costs have a significant mediating effect on the relationship between stock liquidity and corporate innovation activities.That is,the improvement of liquidity eases the cost of two types of agency,effectively reducing short-sighted management and short-selling of major shareholders,and thus promoting innovation.After considering the nature of property rights,it is found that the effect of stock flow in state-owned enterprises on enterprise innovation is weaker than that of private enterprises,and only the mediation effect of the first type of agency costs in state-owned enterprises is significant,while the mediation effect of both the first type and the second type of agency costs are significant in private enterprises.Through the above analysis,this paper provides a new research perspective for the study of the impact on stock liquidity from corporate innovation,and makes some contributions to enriching the existing studies.In addition,this paper researched the possible transmission mechanism—agency cost,and provided the reference for enterprises with different property rights to improve the corporate governance mechanism and information transparency.It also provides some empirical evidence for improving stock liquidity to promote enterprise innovation.