TITLE:
Power Allocation and Investment Efficiency of Parent-Subsidiary Company—Empirical Analysis Based on the Perspective of Subdivision of Power
AUTHORS:
Jun Zhou, Zeyu Wong
KEYWORDS:
Parent-Subsidiary Company, Business Group, Power Allocation, Investment Efficiency
JOURNAL NAME:
Modern Economy,
Vol.12 No.9,
September
3,
2021
ABSTRACT: Taking Shanghai and Shenzhen A-share non-financial
listed companies in 2009 and 2019 as samples, from the perspective of financial
rights and personnel rights, this paper makes an empirical study on the
relationship between their allocation between parent and subsidiary and the
overall investment efficiency of listed companies and their subsidiaries, and
further analyzes the moderating effect of the two on the above two
relationships. The research shows that: 1) in the current stage, the
concentration of financial rights improves the investment efficiency of the
parent-subsidiary company; 2) the concentration of the power over personnel has
an inverted U-shaped relationship with investment efficiency; 3) from the
moderating effect of the two, the concentration of financial power flattens the
inverted U-shaped relationship between the concentration of personnel power and
investment efficiency; 4) the concentration of personnel power amplifies the
promoting effect of financial power concentration on investment efficiency, but
this effect is not clear at the low level of personnel power concentration. The
research of this paper is helpful to provide more concrete and operational
reference and suggestions for the management and control of enterprise groups.