Analysis Of The Effect Of Financial Flexibility On Inefficient Investment Chinese OFDI

With China’s economic development and accelerating the process of marketization,the lag of capital market makes the development of domestic enterprises have great restrictions,due to the scarcity of financial resources,resulting in not all enterprises can obtain the funds demand effectively into investment activities through external financing,which makes our country there are a large number of enterprises due to financing difficulties the investment of non efficiency seriously,in the face of the future so uncertain market environment,the enterprise how to deal with the financing difficulties of the external environment,enhance their ability of future financial risk,reasonable grasp investment opportunities to resist effectively,is essential for the survival and development of enterprises.In recent years,global inflation crisis,and thus resulting in a large number of Chinese credit crunch,making a large number of companies are facing financing difficulties,and then encountered many setbacks in the way to carry out"The Belt and Road" strategy,enterprises in the "The Belt and Road under the background of" effective response to uncertainty in the market,so as to effectively grasp the investment opportunities in the future that is highly valued in today’s academic topic.Therefore,in the realistic background,it is of practical significance to study the relationship between financial flexibility and inefficient investment in China’s listed companies from the perspective of financing constraints.First of all,this paper introduces the research background and significance,and briefly describes the research content.research methods and innovation.The literature and theories about financing constraints,financial flexibility and inefficient investment are collated and commented on at home and abroad,which lays a theoretical foundation for the following empirical analysis.Secondly,from the perspective of theoretical analysis,this paper points out that the impact of entrenchment motivation on corporate investment and the impact of corporate financial flexibility on corporate investment are opposite.Based on the theoretical analysis,this paper puts forward three assumptions:(1)lack of financial flexibility and investment negative correlation,financial flexibility and excessive investment in positive correlation;(2)when the financing constraint is higher,there was a negative correlation between the lack of financial flexibility on inefficient investment phenomenon.When the high financial constraints,financial flexibility is more conducive to non-state-owned enterprises to alleviate the shortage of non efficiency of investment;(3)when the financing constraint is higher,there was a negative correlation between the lack of financial flexibility on inefficient investment phenomenon.When the financing constraints are higher,financial flexibility is more conducive to non state-owned enterprises to alleviate the lack of investment in inefficient investment.Thirdly,this paper makes a descriptive statistical analysis on the manufacturing companies of A shares in 1615 Shanghai and Shenzhen two cities listed in Shanghai and Shenzhen stock markets from 2007 to 2015,and gets the initial research hypothesis.The Richardson residual model and establish the regression model,the empirical validity of the study hypothesis,and further through the robustness test on multiple regression model replacing variables,correctness and robustness to test the model,get the conclusions as follows:(1)when the financial constraint level of listed companies is relatively high,the level of investment company significant phenomenon low and insufficient investment.(2)there is a significant negative correlation between financial flexibility and underinvestment.That is to say,the smaller the financial flexibility is,the more serious the phenomenon of the lack of FDI is.(3)when listed companies face higher financing constraints,there is a negative correlation between financial flexibility and underinvestment of listed companies.(4)when the level of financing constraints is high,the financial flexibility is negatively related to the underinvestment in inefficient investment.(5)when the level of financing constraints is high,financial flexibility is more conducive to the non state owned enterprises to alleviate the lack of investment in inefficient investment.Finally,in view of China’s listed companies on financial flexibility and non efficiency of investment,put forward the active reserve of financial flexibility,establish timely and reasonable "flexible financial investment"warning system and strengthen the supervision of the company three countermeasures,provide a reference for corporate governance,then presents the limitations of the research.