A Study On The Institution Environment, Management Behavior's Influence On Listed Corporation Efficiency

Most of existing literatures about corporate efficiency care about corporate economic efficiency or market performance. And these literatures use Tobin's Q and roe to indicate corporate efficiency. In the view of finance management, corporate finance is consist of corporate investing, corporate financing and corporate operation. We will analyze some factors which have effect on the efficiency of corporate investing, corporate financing and corporate operation.Firstly, we review various theories about corporate efficiency. It is a generally believe that management self-interested behavior may induce a low efficiency for companies in academia. However, with the born of some papers of La Portal et al.'s, academic circle turn to think about institution, outside environment affection on corporate efficiency. For China which is in the transition, what is the effect of specific characteristics for institution on corporate investing, financing and operation? There isn't a final conclusion. This paper would think about outside institution, environment and classical self-interested management influence on corporate efficiency.Then we deeply analyze the unique institution and environment for China, point out some features for China which is in transition. We argue that Chinese institution environment would distort listed companies efficiency. Thus, we firstly analyze the institution environment and management behavior effects on corporate financing efficiency. In a perfect world, corporate financing efficiency depends on the assets risk premium and risk-free interest ratio. Through analyze, the institution environment influence upon corporate equity cost was confirmed by us. We find that institution environment effect varies in different times. And we don't find any evidence that management self-interested behavior can make a strong effect on corporate financing cost.We analyze the influence of institution environment and management behavior on corporate investment efficiency. In the perfect world, corporate optimal investment efficiency depends on the investment project output. By empirical study, we find that both institution environment and management behaviors would conduct an impact on corporate investment efficiency. Government intervention will lead to excessive investment of listed companies, for the goal of absorb more labor and more tax revenue by the excessive investment and new investment projects conducting. However, management behavior would result in insufficient investment in listed companies, which indicates that managers don't tend to seek personal gain by over-investment, but prefer to be shrink caused under-investment.Finally, we analyzed the institution environment and management behavior impacts on corporate operation efficiency. Due to agency problem, corporate efficiency can not be the best. And the outside institution also affect corporate operation efficiency. We employ stochastic frontier analysis(SFA), to compute the efficiency for Chinese listed companies, and then analyze the institution environment, management incentive, market competition influence on corporate operation efficiency.We find that government intervention have a strong influence on corporate efficiency in every industry, whatever the competitive extent is. And we find manager incentive can't affect corporate operation efficiency. Market competition can enhance corporate operation efficiency, by offer competition stress to managers.