Does media governance restrict corporate overinvestment behavior? Evidence from Chinese listed firms

Using China's A-share listed firms from 2007 to 2011, this paper empirically tests how media governance affects firms' levels of overinvestment and whether external supervision and informal institutional mechanisms reduce these levels.We find that media governance and overinvestment are significantly negatively related. When firms are located in a district with a stronger media governance environment their levels of overinvestment are lower, indicating that media governance significantly restricts overinvestment behavior. When internal corporate governance efficiency is low, the negative relationship between the media environment and overinvestment behavior is significantly enhanced,indicating that when internal governance or formal systems have reduced efficacy, an important complementary role is played by external supervision and the informal institutional environment. After considering endogeneity and different measures of overinvestment and other related variables, the conclusions remain unchanged.

China's Overinvestment and International Trade Conflicts

For a long time, China s impressive growth performance has been driven by investment and high productivity gains. Based on a discussion of possible overcapacities and overinvestment in China, this paper investigates the sustainability of China s investment and export-driven growth model. Since the turn of the millennium, buoyant capital inflows and low interest rates have been at the root of overinvestment and misallocation of capital, which necessitated export subsidies to clear markets. The overinvestment boom is argued to have ended around 2014. Since then, the overcapacities have weakened China's bargaining position in the US-Chinese trade conflict and have tempted Chinese authorities to postpone the restructuring of the Chinese economy by providing low-interest credit. The gradual reemergence of quasi-soft budget constraints is seen to undermine China s long-term growth potential.

Earnings information quality, debt maturity structure and investment efficiency

This paper studies the effect of earnings information quality and debt maturity structure and their interaction on investment efficiency. The results show that companies with higher earnings information have higher investment efficiency, and the quality of earnings information has increased investment efficiency by reducing the lack of investment and suppressing overinvestment. The companies with higher short-term debt ratio show higher investment efficiency. The results show that there is a certain substitution effect between the effect of earnings information quality and the maturity strueture of debt on the efficiency of investment.

Analysis on the Influence of Inefficient Investment of Internal Controls

This paper takes 2011-2013 Chinese A shares of listing Corporation as the object of study and researchs the problem between internal controls and overinvestment and tmderinvestment.Through this paper, the study find reasonable and effective internal controls can restrain overinvestment and underinvestment, Overall, strengthening the constmclion of internal controls is an effective way to improve the efficiency of corporate investment.

Local fiscal distress and investment efficiency of local SOEs

In this paper, we use A-share listed firms between 2002 and 2010 to investigate the relationship between local fiscal distress and the investment efficiency of local SOEs, along with the effect of corporate tax payments on this relationship. We find a positive relationship between the extent of local SOEs' overinvestment and the fiscal distress of the corresponding local government where the enterprise and this relationship become stronger for firms that pay fewer taxes. The pattern of underinvestment among local SOEs was in contrast,and these relationships do not exist for non-SOEs or central SOEs. Moreover,we find that expanding a firm's investment scale leads to an increase in total taxes paid, including income and turnover taxes, which further result in more local fiscal revenue. Overall, we conclude that local governments have an incentive to increase fiscal revenue when faced with fiscal distress by raising the investment scale of local SOEs and that the incentives and effects of such interventions appear to be stronger among firms that contribute less to local fiscal revenue.ó 2013 Production and hosting by Elsevier B.V. on behalf of China Journal of Accounting Research. Founded by Sun Yat-sen University and City University of Hong Kong.