自由现金流的过度投资外文文献综述.docVIP

本科毕业论文（设计） 外文翻译 原文： Over-investment of Free Cash Flow This paper examines firm investing decisions in the presence of free cash flow. In theory, firm level investment should not be related to internally generated cash flows (Modigliani and Miller, 1958). However，prior research has documented a positive relation between investment expenditure and cash flow (e.g., Hubbard, 1998). There are two interpretations for this positive relation. First, the positive relation is a manifestation of an agency problem, where managers in firms with free cash flow engage in wasteful expenditure (e.g., Jensen 1986 and Stulz 1990). When managers’ objectives differ from those of shareholders, the presence of internally generated cash flow in excess of that required to maintain existing assets in place and finance new positive NPV projects creates the potential for those funds to be squandered. Second, the positive relation reflects capital market imperfections, where costly external financing creates the potential for internally generated cash flows to expand the feasible investment opportunity set (e.g., Hubbard and Petersen 1988 and Hubbard, 1998). This paper focuses on utilizing accounting information to better measure the constructs of free cash flow and over-investment, thereby allowing a more powerful test of the agency based explanation for why firm level investment is related to internally generated cash flows. In doing so, this paper is the first to offer large sample evidence of over-investment of free cash flow. Prior research, such as Blanchard and Vishny (1994), document excessive investment and acquisition activity for eleven firms that experience a large cash windfall due to a legal settlement, Harford (1999) finds using a sample of 487 takeover bids, that cash rich firms are more likely to make acquisitions that subsequently experience abnormal declines in operating performance, and Bates (2005) finds for a sample of 400 subsidiary sales from 1990-1998 that firms who re