Study On The Influence Of Bank Connection To Inefficient Investment Under Life Cycle Perspective

As the Chinese market economy develops continuously,private enterprises,which have burst into great vitality in the entire national economy,play a vital role in promoting the economic development of our country.In the course of the development of private-owned enterprise,the capital issue has always been the greatest obstacle.The cost factors such as capital,market risk and management have also become the problems that private-owned enterprises must pay attention to when making investment decisions.It has become difficult for many private-owned enterprises to survive in the market due to insufficient capital.Since the funding issue is of crucial importance,bank loans are obviously an important guarantee for the development.To make is easier for private enterprises to borrow capital,a greater number of enterprises began to try to establish cooperative relations with banks.By establishing the equity relationship and hiring directors,supervisors and senior executives with bank background,the enterprises establish relations with banks,thus easing the issue of financing constraints.This type of relationship has been continuously developed.In addition,under different life cycle stages,the enterprises are characterized by differences in profitability and solvency,and their investment efficiency differ greatly.Therefore,private enterprises must make appropriate investment decisions according to the different stages of their life cycle.The main purpose of this paper is to explore how the relationships between banks and enterprises inhibit the inefficient investment and how to affect differently under different stages,and therefore,to provide the data support and opinion for the private enterprises in all stages about improving the investment efficiency.This article includes six chapters:Chapter One is introduction,which introduces the research background,explains the research purpose,and expounds the research content and research ideas of this article.Chapter Two is definition and overview of related theories,which first defines the concepts of bank-enterprise relationship,business life cycle and investment efficiency,and summarizes their main measurement methods,then expatiates information asymmetry theory,principal-agent theory,financing constraint theory,and,based on those theories,analyzes the impact mechanism of life cycle of enterprises and the bank-enterprise relationship relationships on inefficient investment.The Chapter Three is empirical research design.In this chapter,we mainly put forward the hypothesis of this article based on the previous theoretical analysis,and analyzed and explained the sample selection,the data source,the variable measurement,and the empirical model construction.Chapter Four is the empirical research process and results.This chapter takes the data of non-financial private listed companies in Shanghai and Shenzhen A-shares in 2012-2016 as a sample and conducts regression analysis on this sample,and implemented descriptive,correlation analysis,regression analysis and robustness analysis on the results.Chapter Five is conclusions and suggestions.Based on the above research,this chapter draws conclusions of this research and provide some policy recommendations on how to improve the inefficient investment in China's private enterprises according to the conclusion of this article.At the same time,it points out the limitations of this paper.This study finds that inefficient investments populate among privately listed companies in our country.The problem of underinvestment is relatively common in terms of quantity.While overinvestment is even more serious in terms of degree.The relationship between bank and enterprise can significantly improve the efficiency of private listed companies' inefficient investment,at the same time,the inhibitory effect of the relationship on the inefficient investment of private enterprises differs significantly in terms of stages.Finally,according to the conclusion of this paper,the author offers some advices from three aspects:government,bank,and enterprise,and constructs an appropriate and good market-oriented relationship between banks and enterprises according to the stage of development of the enterprise so as to solve the problems of non-efficiency investments among private listed companies.