The Influence Of Financial Degree Of Non-financial Enterprises On Firms' Investment Efficiency

With the development of the economy,financial markets play an important role.At present,China's real economy is in a period of transition.In addition to its own development,enterprises are more eager to invest capital in places with higher profits,shorter payback periods,and lower risks.In order to meet the needs of enterprises,they will turn their attention to financial markets to get a higher return.However,nonfinancial companies are not very familiar with the situation of financial markets.And there is lack of professional talents in the company to guide them.There are certain irrational situations in the investment of financial assets of enterprises.Therefore,whether enterprises invest in financial products can certainly help enterprises to profit and develop remains to be studied.From the perspective of enterprises' investment efficiency,this paper selects Ashare listed companies as the research object,chooses the proportion of financial assets in total assets to measure the degree of financialization,and uses the residuals to measure the efficiency of enterprise investment which is in the regression of actual investment equation by using in Richardson's(2006)paper.The Sys-GMM model is used to study the relationship between the degree of financialization and investment efficiency.According to the proportion of fixed assets,all samples are divided into three categories.This paper explores the difference of the degree of financialization and investment efficiency among different companies.Considering the different nature of financial assets will have different impact on the efficiency of investment,this paper divides financial assets into three categories,Trading Financial Assets,Investment Real Estate,and Trust Financial Assets,and deeply explores the impact of two types of assets on investment efficiency.The results show that there is a non-linear relationship between the degree of financialization of non-financial enterprises and investment efficiency.In one side,financialization can improve the efficiency of enterprise investment,in other side financialization will reduce investment efficiency.For different enterprises,higher fixed assets companies have a more important effect of the degree of financialization.Due to their strong liquidity,Trading Financial Assets have strong influence on the volatility of investment efficiency,while Investment Real Estate with high purchase costs and low liquidity have a great impact on the investment efficiency of enterprises.The allocation of financial assets such as Financial Management Trusts has improved the efficiency of corporate investment.According to the results,this paper puts forward three suggestions for the financial behavior of enterprises.First,from the perspective of restraining the allocation of financial assets,enterprises should allocate financial assets to a limited extent,give full play to the advantages that financial assets bring to enterprises,carefully choose the types of financial assets——mainly Trading Financial Assets,Financial Management Trust,supplemented by Investment Real Estate.Policy makers can adopt policies that are parallel to regulation and incentives.Encourage companies to invest their money in the real estate industry.Second,from the perspective of profitability of enterprises,enterprises should not only pursue high-profit financial assets,but also focus on improving the investment income of operating projects.Enterprises should accelerate innovation,promote production progress and technological transformation,and increase profit levels.The third is to improve the financing mechanism of SMEs.On the one hand,they can reduce the demand for shadow banking in the market.On the other hand,they can set up intermediaries to integrate funds for issuing entrusted loans and achieve professional management.