| Expanding the opening of stock market is an important part of China’s opening to the outside world.In order to serve the supply-side structural reform and achieve high-quality economic development,the Chinese government is earnestly promoting the comprehensive deepening of the stock market reform and opening up.The opening of the stock market to the outside world means that foreign investors are allowed to invest in the domestic stock market.The opening of the stock market to the world will help the domestic stock market to quickly absorb the advanced experience of the overseas market,which will change the investment ecology of China’s stock market,undoubtedly bring new development opportunities for China’s stock market,and may help improve the ability of the stock market to serve the real economy in the long run.Under this realistic background,the economic impact brought by the opening of stock market to China has become an important topic concerned by the academic and practical circles.Different from the situation of western developed countries,China’s securities market is rooted in China’s transition economy,the protection level of small and medium-sized investors is low,the capital market legal system is not perfect and the rule of law is prominent,and the corporate governance structure is not yet mature.Therefore,in this special institutional environment,whether China has the conditions to open the stock market and give full play to its positive economic effects? which remains to be further explored and studied.The implementation of the "Shanghai-Hong Kong stock connect" policy,as an important measure for China’s a-share market to connect with the international stock market,marks the further opening of China’s stock market and has A far-reaching impact on the future reform and opening of China’s stock market.With the help of the quasi-natural experimental platform of "Shanghai-Hong Kong stock connect",this paper aims to comprehensively analyze the impact of China’s stock market opening on listed enterprises from the perspective of enterprise investment efficiency,so as to discuss how the entry of foreign investors affects the ability of stock market to serve the real economy.The opening up of the stock market has a certain positive effect on the investmentefficiency of enterprises: after the opening up of the stock market,foreign investors can buy the stocks of listed companies.On the one hand,foreign investors have more specialized investment ability and information processing capacity and unique private information,which can promote the level of corporate information disclosure and improve the efficiency of stock pricing,thereby reducing the cost of equity capital of listed companies,thus slowing down the under-investment behavior.On the other hand,they use rich trading experience,advanced technical analysis ability,relatively independent social network and strong investor protection awareness to form supervisory pressure on the management and controlling shareholders of listed companies,which helps to improve the corporate governance mechanism and restrain excessive investment behavior.But foreign investors Information superiority theory is that local investors within the territory of comparison,because foreign investors is not familiar with the domestic financial accounting system,lack of local information and field research cost is higher,they often do not have the enthusiasm of regulation,it is difficult to play an effective direct regulation effect;In addition,China’s relatively weak property rights protection system may cause foreign investors to lose interest in carrying out risk arbitrage in China’s stock market,so it can’t improve the price pricing efficiency,and the voting mechanism with feet will also be ineffective.Based on this,does the opening of China’s stock market have a significant impact on the investment efficiency of listed companies? What is the underlying mechanism? These problems need further empirical research.Based on the theory of information superiority of Foreign investor and the theory of supervision of Foreign investor,this paper establishes the PSM-DID model based on the exogenous event of the implementation of China’s "Shanghai-Hong Kong stock connect" policy,and empirically analyzes the impact of China’s stock market opening on the investment efficiency of enterprises and its mechanism.The empirical research findings of this paper are as follows:Firstly,the research on the relationship between the stock market opening and the investment efficiency of enterprises.Main findings:(1)Compared with the control group,the implementation of the "Shanghai-Hong Kong stock connect" policy has indeed effectively improved the investment efficiency of listed companies in China;(2)Compared with the sample of enterprises whose underlying stocks are less actively traded in the stock connect,the impact of the implementation of the stock connect policy on the investment efficiency of the companies whose underlying stocks are actively traded is more significant;(3)Further considerate the lag effect of "Shanghai tong" policy,it found that Chinese stock market opening plays a significant role in the effect of investment efficiency and the implementation of the "Shanghai tong" policy promote efficiency,and enhance the role over time.The findings of the expanded empirical study are as follows:(1)This paper divides the non-efficient investment of enterprises into two groups: over-investment and under-investment.Compared with the under-investment sample group,the non-efficient investment behavior of the sample group of over-investment enterprises has been more strongly and significantly improved after the implementation of "Shanghai-Hong Kong stock connect".(2)In addition,the samples of enterprises are divided into sample groups of state-owned enterprises and sample groups of non-state-owned enterprises,the results show that the implementation of "Shanghai-Hong Kong stock connect" policy has a more significant promoting effect on the investment efficiency of state-owned enterprises,but has no significant influence on the investment efficiency of non-state-owned enterprises.(3)From a comprehensive perspective,the improvement effect of the implementation of the "Shanghai-Hong Kong stock connect" policy on efficiency is mainly reflected in improving the under-investment of non-state-owned enterprises and restraining the over-investment of state-owned enterprises.Secondly,the research on the specific mechanism of stock market opening affecting the investment efficiency of enterprises.(1)Based on the exogenous event of the implementation of the "Shanghai-Hong Kong stock connect" policy,this paper further empirically analyzes the impact and mechanism of the opening up of the stock market on the equity capital cost of listed companies in China and whether the policy influences the investment efficiency of enterprises through the equitycapital cost channel.This paper finds that:(1)Compared with the control group,after the implementation of the "Shanghai-Hong Kong stock connect" policy,with the increase of the degree of the stock market opening,the equity capital cost of Chinese enterprises has experienced a significant reduction.(2)This paper finds that "Shanghai-Hong Kong stock connect" can reduce the cost of equity capital by improving the financial information disclosure and corporate social responsibility information disclosure of listed companies in China.(3)After the launch of "Shanghai-Hong Kong stock connect",compared with the sample of the control group,the non-efficient investment level of the experimental group whose cost of equity capital experienced a more significant decline with greater improvement.This shows that the "Shanghai-Hong Kong stock connect" policy improves the investment efficiency of enterprises by reducing the cost of equity capital.(2)Finally,this paper empirically analyzes whether the "Shanghai-Hong Kong stock connect" policy can affect the investment efficiency of enterprises through the channel of executive compensation incentive.It is found that:(1)The implementation of the "Shanghai-Hong Kong stock connect" policy has significantly improved the sensitivity of executive compensation for performance of listed companies in China.(2)Compared with non-state-owned enterprises,the impact of the implementation of the "Shanghai-Hong Kong stock connect" policy on the sensitivity of executive compensation for performance of state-owned enterprises is more significant.(3)The heterogeneity test found that the "Shanghai-Hong Kong stock connect" policy had a more significant impact on the sensitivity of executive compensation for performance of those enterprises with serious agency conflicts.(4)The implementation of the "Shanghai-Hong Kong stock connect" policy restrains the tendency of excessive investment and improves the investment efficiency of enterprises by improving the compensation incentive of company executives.This shows that the "Shanghai-Hong Kong stock connect" policy improves the investment efficiency of enterprises by improving the performance incentive of executive compensation.The official implementation of the "Shanghai-Hong Kong Stock Connect" policy,as an important measure for China’s A-shares to connect with the international stock market,marksthe further opening of China’s stock market and has a profound impact on the future reform of China’s stock market and opening.This article provides empirical evidence for the economic effects of China’s stock market opening at the micro-enterprise level.The relevant conclusions show that the implementation of the "Shanghai-Hong Kong Stock Connect" policy has a significant positive effect on the efficiency of capital allocation in the stock market and helps promote the health of the stock market and improve the ability of the stock market to serve the real economy.Therefore,promoting the further opening of the stock market is of great significance for improving the investment efficiency of companies,realizing the healthy development of the stock market and enhancing the ability of the stock market to serve the real economy. |
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