Research On The Impact Of Stock Price Informativeness On Total Factor Productivity Of Firms

Total factor productivity is regarded as the source of long-term sustainable economic growth,and the report of the 20th National Congress emphasizes the need to improve total factor productivity and makes it one of the tasks to promote high-quality development.Domestic and foreign literature has studied the influencing factors of total factor productivity in terms of technological progress,resource allocation efficiency,factor quality,and institutional policy environment,respectively,while relatively little research has been conducted on the impact of stock price information on enterprise productivity.Some scholars in academia believe that the stock market has the function of information transmission,and information can be transmitted and gathered into stock prices through trading activities between different investors;therefore,stock prices reflect internal information of company management about the company’s operation on the one hand,and on the other hand,they include private information of investors and other outsiders about the condition of the company and the market situation,and corporate managers can The company managers can learn the information that is not available in the stock price,so that they can improve their actual business decisions,optimize the allocation of resources,and thus have an impact on the productivity of the company.Overseas studies have shown that the information content of stock price has an impact on the business activities of enterprises,but there is a gap between China’s capital market in terms of institutional environment and perfection compared with the developed countries in the West,and it needs to be further tested whether the price information of stock market has an impact on the total factor productivity of enterprises.This paper empirically investigates the impact of stock price information content on the total factor productivity of enterprises by using the data of listed companies in China’s Shanghai and Shenzhen A-share markets from 2007 to 2021 as a sample,and analyzes the heterogeneity in three aspects:enterprise asset structure,enterprise growth and financing constraints.After the empirical study’ the main conclusions of this paper are as follows:(1)the share price information content of listed companies in China’s Shanghai and Shenzhen A-share markets can significantly improve the total factor producti vity level;(2)the share price information content can significantly improve the output level of companies and reduce labor costs and operating costs,enhance the efficiency of enterprise resource allocation and the existence of resource allocation channels;(3)the increase in the proportion of fixed assets of enterprises will reduce the impact of share price information content on total factor productivity changes.(4)the positive effect of stock price information on total factor productivity is more obvious in high-growth firms,vhich are more motivated to extract idiosyncratic information from stock prices and are more adept at using the feedback effect of stock prices to enhance TFP.(5)Financing constraints strengthen the positive relationship between the information content of share prices and firms’ total factor productivity.The greater the financing constraint,the more motivated and willing the firm’s management will be to use stock price information to optimize the firmi’s resource allocation.The main contributions of this paper are:firstly,using a combination of theoretical analysis and empirical research,this paper empirically investigates the impact of stock price information content on total factor productivity of listed companies in China from the perspective of stock price information content,using a sample of A-share listed companies in Shanghai and Shenzhen,and the mechanism path of this impact;secondly,this paper conducts a heterogeneity analysis based on firm asset structure,firm growth and financing constraints,and analyses the differences in the impact of stock price information content on total factor productivity.Secondly,this paper analyses the differences in the impact of the information content of share prices on total factor productivity by conducting a heterogeneous analysis based on firm asset structure,firm growth and financing constraints.Thus,this study can reflect the combined impact of China’s capital market construction,the governance mechanism of listed companies and the policy environment.and provide policy support to improve the operation of China’s capital market and enhance the total factor productivity of enterprises.