The Impact Of Internationalization Of Chinese Enterprises On Inefficient Investment

In the context of the new development pattern,the pace of overseas expansion of Chinese enterprises has accelerated,but multinational companies face a complex overseas environment in the process,and the problem of inefficient investment by multinational companies has become one of the important factors restricting Chinese enterprises’ "going out" and achieving high-quality development.Based on the policy background of "going out" of Chinese enterprises,it is important to investigate the influence mechanism of internationalization degree on investment efficiency and understand the factors influencing the inefficient investment of Chinese enterprises going out,which is of certain guidance and practical value for Chinese enterprises to "go out" and achieve high-quality development.It has certain guiding significance and practical value for Chinese enterprises to go global and achieve high-quality development.This paper compares the existing literature to understand the research progress on the issue of corporate inefficient investment,specifically compares corporate internationalization theory and inefficient investment theory,and proposes a series of research hypotheses.In this paper,we select the data of companies listed in A-shares in Shanghai and Shenzhen markets in China that have overseas operation experience from2010-2021,firstly,we use Richardson’s residual measure model to measure inefficient investment in the sample,and then we test the non-linear relationship between the degree of corporate internationalization and inefficient investment with the main regression fixed time,industry and province,and add capital structure(gearing ratio)as a mediating Finally,robustness tests and heterogeneity analysis are conducted on the main regression results.The research results show that: 1.the degree of enterprise internationalization and inefficient investment have a positive U-shaped relationship.The efficiency of corporate investment basically improves with the deepening of internationalization in the early stage of MNCs;the higher the degree of overseas operation in the later stage,the level of corporate inefficient investment increases.2.Capital structure(gearing ratio)plays a part in mediating the effect of internationalization degree on inefficient investment.3.From the perspective of inefficient investment behavior: whether overinvestment or under-investment,the degree of enterprise internationalization has a positive U-shaped relationship with the level of inefficient investment.In terms of the nature of property rights: the results of the private enterprise sample are consistent with the main regression,while state-owned multinational enterprises are subject to more supervisory constraints and their internationalization degree does not have a significant effect on the level of inefficient investment.From the perspective of industry heterogeneity: high-tech industry firms have higher industry barriers and serious information asymmetry problems,and their degree of internationalization has a positive U-shaped relationship with inefficient investment.In contrast,the results for the nonhigh-tech industry sample are not significant.From the perspective of regional heterogeneity: the internationalization degree of eastern and western firms has a positive U-shape relationship with inefficient investment.There is no significant result in the central region.Finally,based on the above main findings,this paper provides policy recommendations for how MNCs can better go global and mitigate the phenomenon of inefficient investment.