| Investment is one of the three forces driving growth for economies.The Party’s 20 th National Congress pointed out that "high-quality development is the primary task for comprehensively building a modern socialist country." The high-quality development of a country’s economy ultimately depends on the high-quality development of enterprises,and investment is one of the key factors affecting the high-quality development of enterprises.At the micro-firm level,since investment activity is an essential part of production and management,its efficiency affects firm’s value and development potentiality.Therefore,investment decisions are quite important.As one of the core executives of the firm,the Chief Executive Officer(CEO)is not only the main maker of business management and investment decisions but also the actual executor,which makes CEO’s professional ability,network resources,experience accumulation and social background influencing firm’s investment efficiency.Thus,from the perspective of CEO’s social capital,this paper studies how to improve the investment efficiency of firm.Specifically,based on special "relational" social background in China,this paper focuses on social networks,uses the data of A-share listed firms in Shanghai and Shenzhen stock markets from 2008 to 2020,and analyzes how CEOs accumulate social capital and further affect the investment efficiency of firms by constructing different types of social network.The results show that: first,CEO social capital can significantly improve firm’s investment efficiency,that is,more CEO social capital leads higher investment efficiency of firm;second,according to the types of inefficient investment,the whole sample is divided into two sub-samples: overinvestment and underinvestment,the results show CEO social capital has a significant inhibitory effect on both over-investment and under-investment;third,earnings management and agency cost will weaken the positive effect of CEO social capital;finally,according to firm’s ownership,the CEO social capital of non-state-owned enterprises has a significant effect on improving efficiency of enterprise investment,while CEO social capital of state-owned enterprises has no significant correlation with the efficiency of enterprise investment.The conclusions of this paper are of great significance for enterprises to improve investment efficiency,effectively select and hire CEO,and encourage CEO social capital to serve the high-quality development of enterprises.First of all,enterprises should pay attention to CEO social capital and select high-ability talents.Secondly,enterprises should not only realize the importance of CEO social capital,but also encourage CEO to use social capital to improve the efficiency of corporate investment. |
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