Do firms’ pension contributions decrease their investment efficiency in Chinese context?
South African Journal of Business Management
| Field | Value | |
| Title | Do firms’ pension contributions decrease their investment efficiency in Chinese context? | |
| Creator | Wang, Jin Wang, Deli Long, Hai Chen, Yu | |
| Description | Purpose: This research aims to investigate whether increasing the pension contributions of a firm leads to inefficient investments.Design/methodology/approach: Based on the 26 135 observations of the Chinese listed firms, this study employs ordinary least squares models to investigate the relationship between pension costs and inefficient investments.Findings/results: This study shows that Chinese listed firms’ pension contribution increments result in fewer investment opportunities and a decreased in investment efficiency. This is insignificant for the more profitable firms and state-owned enterprises. It suggests further that a firm’s pension cost is significantly associated with its investment inefficiency, particularly for cash flow dominated and financing–restricted firms. This indicates a negative association between pension contributions and cash flows, and several pension contributions may lead to a cash flow shortage in the firms.Practical implications: For managers, they should improve their investment efficiency within an affordable pension plan; for investors, increasing pension costs potentially decrease their investment returns.Originality/value: Some findings have reference values for some developing countries. | |
| Publisher | AOSIS | |
| Date | 2023-03-24 | |
| Identifier | 10.4102/sajbm.v54i1.3449 | |
| Source | South African Journal of Business Management; Vol 54, No 1 (2023); 13 pages 2078-5976 2078-5585 | |
| Language | eng | |
| Relation |
The following web links (URLs) may trigger a file download or direct you to an alternative webpage to gain access to a publication file format of the published article:
https://sajbm.org/index.php/sajbm/article/view/3449/2439
https://sajbm.org/index.php/sajbm/article/view/3449/2440
https://sajbm.org/index.php/sajbm/article/view/3449/2441
https://sajbm.org/index.php/sajbm/article/view/3449/2442
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