scholarly journals Motivated monitoring by institutional investors and firm investment efficiency

2019 ◽  
Vol 26 (2) ◽  
pp. 348-385 ◽  
Author(s):  
Charles Ward ◽  
Chao Yin ◽  
Yeqin Zeng
Keyword(s):  
Institutional Investors ◽  
Investment Efficiency ◽  
Firm Investment

Conditional Conservatism and Firm Investment Efficiency

2010 ◽  
Author(s):  
Juan Manuel García Lara ◽  
Beatriz Garcia Osma ◽  
Fernando Penalva
Keyword(s):  
Investment Efficiency ◽  
Firm Investment ◽  
Conditional Conservatism

scholarly journals Financial Liberalization, Economic Growth and Investment Strategy: Lessons from Taiwan for New Industrial Countries

2015 ◽  
Vol 3 (2) ◽  
pp. 188 ◽  
Author(s):  
Yu-Wei Lan ◽  
Dan Lin ◽  
Lu Lin
Keyword(s):  
Economic Growth ◽  
Institutional Investors ◽  
Foreign Capital ◽  
Investment Strategy ◽  
Capital Inflows ◽  
Investment Efficiency ◽  
The Real ◽  
Foreign Capital Inflows ◽  
Foreign Institutional Investors ◽  
The Impact

<p><em>To examine the impact of foreign capital inflows on Taiwan’s economy after internet bubbles of 2000, this study adopts data from the first quarter of 2001 to the second quarter 2015 to test if foreign capital inflows have positive impacts on Taiwan’s economic growth. This study also uses program trading and aims to prove that with financial liberalizations, the investment efficiency of foreign institutional investors is better than domestic institutional investors.</em></p><p><em>The results from the error correction model shows that capital formation, domestic savings and foreign direct investment all have positive relationships with the real economic growth. However, the rate of financing and foreign debt and depreciation all have negative relationships with the real economic growth. The results are all statistically significant. Hence, they do not completely support the hypothesis that foreign capital inflows are beneficial for economic growth.</em></p><p><em>Moreover, this study proves that the futures market in Taiwan is not strong-form market efficient. This result provides support for the hypothesis that the investment efficiency of foreign institutional investors is higher than that of domestic institutional investors. Investors can therefore raise their investment performance by following the investment strategies of foreign institutional investors.</em></p>

scholarly journals Independent directors and corporate investment: evidence from an emerging market

2019 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Quoc Trung Tran
Keyword(s):  
Stock Exchange ◽  
Emerging Market ◽  
Corporate Investment ◽  
Independent Directors ◽  
Investment Efficiency ◽  
Firm Investment ◽  
Full Sample ◽  
Content Type ◽  
Research Findings

Purpose The purpose of this paper is to examine whether independent directors reduce corporate overinvestment and improve investment efficiency in an emerging market. Design/methodology/approach First, the author developed a research model in which corporate investment is a function of Tobin’s Q, the proportion of independent directors in the board and an interaction between them. Second, the author divided the full sample into groups of firms with a low- and high-financial constraint to compare the effects of independent directors between financially unconstrained and constrained firms. Findings With a full sample of 1,281 observations collected from 193 firms listed in Ho Chi Minh Stock Exchange during the period from 2009 to 2017, the author find that the proportion of independent directors is negatively related to firm investment but its interactive term with Tobin’s Q is positively related to corporate investment. These findings imply that independent directors can help firms reduce overinvestment and improve investment efficiency. Moreover, the research findings indicate that these effects of independent directors are stronger for financially constrained firms. Originality/value The extant literature shows that independent directors are an effective mechanism to reduce agency problems in firm decisions and operating performance. However, there has been no research on the role of independent directors in corporate investment policy.

scholarly journals Does Institutional Ownership Improve Firm Investment Efficiency?

2018 ◽  
Vol 56 (12) ◽  
pp. 2772-2792 ◽  
Author(s):  
Yue Cao ◽  
Yizhe Dong ◽  
Yu Lu ◽  
Diandian Ma
Keyword(s):  
Institutional Ownership ◽  
Investment Efficiency ◽  
Firm Investment

The Mutual Friend: Dual Holder Monitoring and Firm Investment Efficiency

2019 ◽  
Vol 9 (1) ◽  
pp. 81-115
Author(s):  
Miguel Antón ◽  
Luca X Lin
Keyword(s):  
Cash Flow ◽  
High Growth ◽  
Investment Efficiency ◽  
Firm Investment ◽  
Control Rights ◽  
Debt Overhang ◽  
Equity Value ◽  
Growth Firms ◽  
Editorial Decision ◽  
And Control

Abstract We investigate the influence of simultaneous equity holdings by creditors (dual holders) on investment efficiency. Such creditors have stronger incentives and power to monitor firm investment as they have cash flow and control rights from both debt and equity sides. We provide evidence that dual holders, particularly noncommercial bank dual holders, significantly mitigate overinvestment. For high growth firms and those subject to debt overhang, dual holders also alleviate underinvestment. Equity value increases at the presence of dual holders. Our results indicate that by improving firm investment efficiency, dual holders not only make creditor investments safer but also create value for shareholders. Received March 26, 2019; editorial decision September 17, 2019 by Editor Isil Erel.

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