Correlation Study On SME Board Listed Companies' Dividend Policy And Investment Efficiency

Investment decision is the three most important decisions in the modern governance of company,and investment efficiency is an important guarantee for the company's future survival and long-term development.However,the non-efficient investment phenomenon is prevalent while the investment scale of China's listed companies continues to grow.The presence of over-investment and under-investment reduces the efficiency of resource allocation.Many foreign scholars have studied the investment efficiency in depth from the perspective of dividend policy,and most of the studies show that dividend policy can effectively alleviate the agency problem and transmit signal,so as to reduce the company's non-efficiency.However,foreign research theory is not necessarily applicable to China's stock market due to China's special background and immature stock market development.Chinese scholars have gradually begun to study the dividend policy and investment efficiency with the continuous development of China's capital market recently,but most studies focus on the motherboard market instead of SME board market.The development of SME board market plays an important role in China's capital market,which is the translational backbone of China's multi-level capital market.Based on financing constraint background,this paper has studied the correlation between dividend policy and investment efficiency by theoretical analysis and empirical test.This paper first reviews the theory of domestic and foreign related literature,and then puts forward several reasonable hypotheses by combining the status of SME board market's dividend distribution and investment efficiency.A modified Richardson model has been constructed to measure level of the non-efficient investment on the basis of the literature research and situation analysis.The correlation has been described by utilizing 2007-2015 data sample of 159 companies and multiple-regression model.The results show that :(1)There exists investment-free cash flow agency problem in SME board listed companies,and under-investment is more serious than over-investment.(2)Cash dividend policy cannot alleviate the overinvestment-free cash flow sensitivity,but can reduce the under-investment phenomenon.(3)The nature of the controlling shareholder and the concentration of ownership influence the governance of the dividend policy,and the effect of the dividend policy are more obvious when the company is non-state-holding or low-equity-concentration.This paper ends with recommendations on how to improve the efficiency of investment.