The Research On The Influence Of Products Market Competition On The Investment Efficiency

Nowadays,the global economy has been developing rapidly and the market competition has become increasingly fierce.In order to secure the survival and development,the company must be confronted with the severe competition.The more competitive the enterprise is,the more resource and benefits it would get.The investment activities,being one of the three financial activities of enterprises,are related with the proper allocation of the resource as well as the value and development of the company.Owing to the information asymmetry and principle-agent problems,the investment inefficiency of the company has become common problem.It is discussable whether products market competition could ease the investment inefficiency.Taking the data of the A-share listed company from 2012 to 2014 as samples,this essay takes the Richardson model to evaluate the investment efficiency,build the model between the investment efficiency and product market competition and explore the relation between these two aspects.According to the research,the products market competition has a positive correlation with the investment efficiency.When the competition becomes fierce,the investment efficiency of the company turns out to be high.This is because that under the fierce competition,the company intends to be more prudent towards its investment with more pressure.Classifying the samples under overinvestment group and underinvestment group,it proved that products market competition could repress the overinvestment while reliving the underinvestment.As to the CONTYPE,compared with the non-state owned enterprises,the investment efficiency of SOEs is relatively low.And it is less sensitive to the products market competition.