Author(s)

Jingqi Li

Corresponding Author

Jingqi Li

Abstract

This paper selects China's A-share listed companies in Shanghai and Shenzhen from 2010 to 2020 as the research object, and empirically tests the influence of product market competition on enterprise investment efficiency from the dynamic perspective of enterprise life cycle. The research results of this paper show that: first, product market competition can improve the investment efficiency of enterprises, that is, it can restrain over-investment and under-investment; Secondly, for enterprises in recession, product market competition will restrain the over-investment of enterprises, but aggravate the under-investment of enterprises; The influence of product competition on over-investment is more significant in growth enterprises; Thirdly, the robustness test is carried out by the substitution variable method, and the regression result is still valid. This paper enriches the related research of enterprise life cycle, the related research of influencing factors of capital allocation efficiency, and provides a certain reference value for improving China's capital allocation efficiency. This paper selects China's A-share listed companies in Shanghai and Shenzhen from 2010 to 2020 as the research object, and empirically tests the influence of product market competition on enterprise investment efficiency from the dynamic perspective of enterprise life cycle. The research results of this paper show that: first, product market competition can improve the investment efficiency of enterprises, that is, it can restrain over-investment and under-investment; Secondly, for enterprises in recession, product market competition will restrain the over-investment of enterprises, but aggravate the under-investment of enterprises; The influence of product competition on over-investment is more significant in growth enterprises; Thirdly, the robustness test is carried out by the substitution variable method, and the regression result is still valid. This paper enriches the related research of enterprise life cycle, the related research of influencing factors of capital allocation efficiency, and provides a certain reference value for improving China's capital allocation efficiency.

Keywords

Enterprise life cycle, Market competition, Investment efficiency, Excessive investment, Undercapitalize