Implementation of the new securities law, agency cost, and corporate investment efficiency

Kun Qian and Jiasong Ren

International Review of Economics & Finance, 2025, vol. 102, issue C

Abstract: This research employs the enactment of the revised Securities Law as a natural experiment benchmark, selecting financial data from listed companies between 2017 and 2023, to empirically explore the influence of the new Securities Law on firm investment efficiency. The article further introduces agency costs as a moderating variable. The results demonstrate that the enactment of the new Securities Law markedly enhances corporate investment efficiency, while agency costs diminish the beneficial impact of the new Securities Law on investment efficiency. The heterogeneity analysis reveals that the enhancing impact of the new Securities Law is particularly pronounced in areas with elevated industrial concentration and within the manufacturing sector.

Keywords: New securities law; Agency costs; Corporate investment efficiency; Difference-in-Differences (search for similar items in EconPapers)
JEL-codes: D22 G30 G32 G38 K22 (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:reveco:v:102:y:2025:i:c:s1059056025003958

DOI: 10.1016/j.iref.2025.104232

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