The Relationship Between Cash Holdings And R&D Investments According To Investor Structure

In this paper,1525 private listed companies with a disclosure of R&D investment from 2011 to 2013 in Shanghai and Shenzhen securities are chosen as the samples of the study.Based on the research at home and abroad and related concepts,theories,it puts forward the hypothesis,and selects the sample,then sets variables,in the next it builds models,then it uses standardized analysis and multiple linear regression to analyze.It brings moderator variables to make empirical analysis for these data with SPSS18.0 to study the relationship among cash holding and R&D investment,and then this paper studies how do the different investors adjust the relationship between cash holdings and R&D investment.In this paper,the investors are divided into internal and external investors,and whether the internal and external investors moderate the relationship between R&D expenditures and cash holding are studied.Empirical results found that:(1)In the private listed companies in our country,cash holding has a positive influence on R&D investment,the more cash holdings they have,the more R&D investments they spend.(2)Internal investors has a positive moderating effect on the relationship between R&D investment and cash holdings.The companies whose internal investors hold higher shareholding incline to put much money into research and development activities.On one hand,under the circumstances business interests and personal interests have high consistency,They will pay more attention to the long-term development of the enterprise to obtain long-term interests compared with short-term interests.On the other hand,when the proportion of internal investors is high,the strength of their participation of corporate governance is strong,therefore they have the ability to influence the enterprise decisions to support R&D activities.(3)External institutional investors have reverse adjustment on the relationship between cash holdings and R&D spending.This shows that China's private listed company's external institutional investors are short-term investors.Compared with internal investors,they focus on the short-term profits.They don't support to spend the spare money to R&D investment.Enterprise senior managers will be affected by the actions taken by the short-term investors,and try to cut investment behavior which may cause the stock price to fall in order to achieve short-term profit goals.